IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this paper

On the Relative Efficiency of Democratic Institutions

Listed author(s):
  • Zimmermann, Klaus W.


    (Helmut Schmidt University, Hamburg)

  • Just, Tobias


    (Deutsche Bank Research)

Strengthening elements of direct democracy has become a hotly debated issue especially in purely representative democracies where distrust in political institutions and policymakers has been continually growing in recent years. We develop a compensation model of interest groups seeking a majority for their projects by compensating potential losers. Assuming a centre-left government backed by a parliamentary majority, we apply the model to interest groups of varying size and ideology acting in democratic systems with and without faction discipline. With faction discipline in a representative system, direct democracy is comparatively advantageous and efficiency-enhancing if a leftist interest group initiates a project. For rightist project proposals, direct democracy performs better only if the winning group is small; this obeservation that indirect democracy has a comparative efficiency advantage for medium-sized and large winning groups can be seen as a demonstration of OlsonÃÂôs encompassing group effect. With faction discipline removed, direct and indirect democracy are generally equivalent. The case in which all members of the governing faction have to be compensated constitutes the only exception for which indirect democracy is superior.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
File Function: Full text
Download Restriction: no

Paper provided by Helmut Schmidt University, Hamburg in its series Working Paper with number 16/2003.

in new window

Length: 25 pages
Date of creation: Jul 2003
Handle: RePEc:ris:vhsuwp:2003_016
Contact details of provider: Postal:
Holstenhofweg 85, D-22043 Hamburg

Phone: +49 (0)40 6541 2590
Fax: +49 (0)40 6541 2780
Web page:

More information through EDIRC

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:ris:vhsuwp:2003_016. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Klaus Bekcmann)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.