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Endogenous Majority Rules with Changing Preferences

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Abstract

This paper provides a new explanation why several US states have implemented supermajority requirements for tax increases. We model a dynamic and stochastic OLG economy where individual preferences depend on age and change over time in a systematic way. In this setting, we show that the first population of voters will choose a supermajority rule in order to influence the outcomes of future elections. We explore the robustness of the basic model and also find some empirical support for predictions derived from the model.

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File URL: http://economics.uwo.ca/research/department_working_papers_docs/wp2000/wp2000_12.pdf
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Bibliographic Info

Paper provided by University of Western Ontario, Department of Economics in its series UWO Department of Economics Working Papers with number 200012.

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Date of creation: 2000
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Handle: RePEc:uwo:uwowop:200012

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Postal: Department of Economics, Reference Centre, Social Science Centre, University of Western Ontario, London, Ontario, Canada N6A 5C2
Phone: 519-661-2111 Ext.85244
Web page: http://economics.uwo.ca/research/research_papers/department_working_papers.html

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  1. Matthias Messner & Mattias K. Polborn, 2004. "Voting on Majority Rules," Review of Economic Studies, Wiley Blackwell, vol. 71(1), pages 115-132, 01.
  2. Gradstein, Mark, 1999. "Optimal taxation and fiscal constitution," Journal of Public Economics, Elsevier, vol. 72(3), pages 471-485, June.
  3. Thomas F. Cooley & Jorge Soares, 1999. "A Positive Theory of Social Security Based on Reputation," Journal of Political Economy, University of Chicago Press, vol. 107(1), pages 135-160, February.
  4. Roger B. Myerson & Daniel Diermeier, 1999. "Bicameralism and Its Consequences for the Internal Organization of Legislatures," American Economic Review, American Economic Association, vol. 89(5), pages 1182-1196, December.
  5. Caplin, Andrew S & Nalebuff, Barry J, 1988. "On 64%-Majority Rule," Econometrica, Econometric Society, vol. 56(4), pages 787-814, July.
  6. Knight, Brian G., 2000. "Supermajority voting requirements for tax increases: evidence from the states," Journal of Public Economics, Elsevier, vol. 76(1), pages 41-67, April.
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Cited by:
  1. Ian Ayres & Colin Rowat & Nasser Zakariya, 2006. "Optimal two stage committee voting rules," Discussion Papers 04-23r, Department of Economics, University of Birmingham.
  2. Ian Ayres & Colin Rowat & Nasser Zakariya, 2011. "Optimal voting rules for two-member tenure committees," Social Choice and Welfare, Springer, vol. 36(2), pages 323-354, February.

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