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Vote Trading in Power-Sharing Systems: A Laboratory Investigation

Author

Listed:
  • Nikolas Tsakas
  • Dimitrios Xefteris
  • Nicholas Ziros

Abstract

Vote trading in power-sharing systems—i.e., systems in which a voter’s utility with respect to the election’s outcome is proportional to the vote share of her favourite party—is, in theory, welfare improving. However, trading votes for money in majoritarian systems may have detrimental welfare effects, especially when voters’ preference intensities are similar (Casella et al., 2012). We use a laboratory experiment to test the effect of vote trading in each of these popular electoral systems on voter welfare and find strong evidence in support of the above intuitions: vote trading in power-sharing systems boosts aggregate welfare across all considered specifications, but it is not welfare improving in majoritarian systems. Importantly, and contrary to theoretical predictions, a substantial share of subjects consistently loses from vote trading even in power-sharing systems, indicating that its welfare effects are not unambiguous.

Suggested Citation

  • Nikolas Tsakas & Dimitrios Xefteris & Nicholas Ziros, 2021. "Vote Trading in Power-Sharing Systems: A Laboratory Investigation," The Economic Journal, Royal Economic Society, vol. 131(636), pages 1849-1882.
    • Handle: RePEc:oup:econjl:v:131:y:2021:i:636:p:1849-1882.
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    File URL: http://hdl.handle.net/10.1093/ej/ueaa105
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    Cited by:

    1. Maxim Senkov & Arseniy Samsonov, 2024. "Should Politicians be Informed? Targeted Benefits and Heterogeneous Voters," Papers 2401.04273, arXiv.org.
    2. Dimitrios Xefteris & Nicholas Ziros, 2024. "The “invisible hand” of vote markets," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 62(1), pages 153-165, February.
    3. Matthew I. Jones, 2024. "Equilibria and Group Welfare in Vote Trading Systems," Papers 2406.09536, arXiv.org.
    4. Bol, Damien & Matakos, Konstantinos & Troumpounis, Orestis & Xefteris, Dimitrios, 2019. "Electoral rules, strategic entry and polarization," Journal of Public Economics, Elsevier, vol. 178(C).

    More about this item

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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