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Majority voting leads to unanimity

  • Asheim , Geir B.

    ()

    (Dept. of Economics, University of Oslo)

  • Claussen , Carl Andreas

    ()

    (Norges Bank)

  • Nilssen, Tore

    ()

    (Dept. of Economics, University of Oslo)

We consider a situation where society decides, through majority voting in a secret ballot, between the alternatives of ‘reform’ and ‘status quo’. Reform is assumed to create a minority of winners, while being efficient in the Kaldor-Hicks sense. We explore the consequences of allowing binding transfers between voters conditional on the chosen alternative. In particular, we establish conditions under which the winners wish to compensate all losers, thus leading to unanimity for reform, rather than compensating some losers to form a non-maximal majority. The analysis employs concepts from cooperative game theory.

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File URL: http://www.sv.uio.no/econ/english/research/unpublished-works/working-papers/pdf-files/2005/Memo-02-2005.pdf
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Paper provided by Oslo University, Department of Economics in its series Memorandum with number 02/2005.

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Length: 26 pages
Date of creation: 07 Jan 2005
Date of revision:
Publication status: Published in International Journal of Game Theory, 2006, pages 91-110.
Handle: RePEc:hhs:osloec:2005_002
Contact details of provider: Postal: Department of Economics, University of Oslo, P.O Box 1095 Blindern, N-0317 Oslo, Norway
Phone: 22 85 51 27
Fax: 22 85 50 35
Web page: http://www.oekonomi.uio.no/indexe.html
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  1. Mathias Dewatripont & Gérard Roland, 1997. "Transition as a process of large-scale institutional change," ULB Institutional Repository 2013/9659, ULB -- Universite Libre de Bruxelles.
  2. Steven Brams & Michael Jones & D. Kilgour, 2005. "Forming stable coalitions: The process matters," Public Choice, Springer, vol. 125(1), pages 67-94, July.
  3. Sebastian Edwards & Daniel Lederman, 1998. "The Political Economy of Unilateral Trade Liberalization: The Case of Chile," NBER Working Papers 6510, National Bureau of Economic Research, Inc.
  4. Sanjay Jain & Sharun W. Mukand, 2003. "Redistributive Promises and the Adoption of Economic Reform," American Economic Review, American Economic Association, vol. 93(1), pages 256-264, March.
  5. Steven J. Brams & Peter C. Fishburn, 1996. "Minimal winning coalitions in weighted-majority voting games," Social Choice and Welfare, Springer, vol. 13(4), pages 397-417.
  6. David P. Baron, 2001. "Theories of Strategic Nonmarket Participation: Majority-Rule and Executive Institutions," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 10(1), pages 47-89, 03.
  7. C. A. Claussen, 2002. "On the Dynamic Consistency of Reform and Compensation Schemes," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 5(3), pages 133-144.
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