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Strategic vote trading in power-sharing systems

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  • Dimitrios Xefteris
  • Nicholas Ziros

Abstract

This paper studies decentralized vote trading in a power-sharing system that follows the rules of strategic market games. In particular, we study a two-party election, in which prior to the voting stage voters are free to trade votes for money. Voters hold private information about both their ordinal and cardinal preferences, whereas their utilities are proportionally increasing in the vote share of their favorite party. In this framework we prove generic existence of a unique full trade equilibrium (an equilibrium in which nobody refrains from vote trading). We moreover argue that vote trading in such systems unambiguously improves voters' welfare.

Suggested Citation

  • Dimitrios Xefteris & Nicholas Ziros, 2016. "Strategic vote trading in power-sharing systems," University of Cyprus Working Papers in Economics 01-2016, University of Cyprus Department of Economics.
  • Handle: RePEc:ucy:cypeua:01-2016
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    File URL: http://papers.econ.ucy.ac.cy/RePEc/papers/01-16.pdf
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    References listed on IDEAS

    as
    1. Casella, Alessandra & Turban, Sébastien, 2014. "Democracy undone. Systematic minority advantage in competitive vote markets," Games and Economic Behavior, Elsevier, vol. 88(C), pages 47-70.
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    8. Alessandra Casella & Aniol Llorente-Saguer & Thomas R. Palfrey, 2012. "Competitive Equilibrium in Markets for Votes," Journal of Political Economy, University of Chicago Press, vol. 120(4), pages 593-658.
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    Cited by:

    1. Dimitrios Xefteris & Nicholas Ziros, 2017. "Strategic vote trading under complete information," University of Cyprus Working Papers in Economics 03-2017, University of Cyprus Department of Economics.

    More about this item

    Keywords

    vote trading; strategic market games; power sharing;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism

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