Direct democracy, coalition size and public spending

Direct Democracy and Public Employees

In the public sector, employment may be inefficiently high because of patronage, and wages may be inefficiently high because of the strength of public employee interest groups. This paper explores whether the initiative process, a direct democracy institution of growing importance, can control these political economy problems, as proponents and some research suggests. Based on a sample of 500+ ...

Coalition formation with local public goods and group-size effect

Many public goods that are provided by coalitions have a group-size e¤ect. Namely, people prefer to consume a public good in a larger coalition. This paper studies local public goods games with anonymous and separable group-size e¤ect. The core is nonempty when coalition feasible sets are monotonic and players’preferences over public goods satisfy a condition called cardinal connectedness. More...

Democracy and Social Spending in Latin America

Immigration and Public Spending

Immigration and Public Spending We examine the effect of immigration on public spending from a theoretical (political economic) and an empirical perspective. We distinguish between public spending on private goods and on public goods. Our model implies that whether immigration increases or decreases public spending primarily depends on native’s preferences for private versus public good spendin...

The price of democracy in coalition formation

Whenever rational agents form coalitions to execute tasks, doing so via a decentralized negotiation process—while more robust and democratic—may lead to a loss of efficiency compared to a centralized solution. To quantify this loss, we introduce the notion of the Price of Democracy (PoD), which measures the amount of resources needlessly committed to the task(s) at hand. After defining this con...