Thinking of electoral rules, common wisdom suggests that proportional rule is more fair, since all voters are equally represented: at times, it turns out that this is false. I study the formation of both Parliament and Government; for the composition of the former I consider plurality and proportional rule; for the formation of the latter, I assume that parties play a non-cooperative game `a la Rubinstein. I show that, unless parties are impatient to form a Government, proportional electoral rules translate into a more distortive distribution of power among parties than plurality rule; this happens because of the bargaining power of small parties during Government formation.
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Paper provided by Institut d'Economia de Barcelona (IEB) in its series Working Papers with number
2009/27.
Find related papers by JEL classification: C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Models of Political Processes: Rent-seeking, Elections, Legislatures, and Voting Behavior H1 - Public Economics - - Structure and Scope of Government P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism
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