TY  - JOUR
AU  - Casella,Alessandra
AU  - Turban,Sébastien
TI  - Democracy Undone. Systematic Minority Advantage in Competitive Vote Markets
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 18573
PY  - 2012
Y2  - November 2012
UR  - http://www.nber.org/papers/w18573
L1  - http://www.nber.org/papers/w18573.pdf
N1  - Author contact info:
Alessandra Casella
Department of Economics
Columbia University
420 West 118 Street
New York, NY 10027
Tel: 212/854-2459
Fax: 212/854-8059
E-Mail: ac186@columbia.edu

Sebastien Turban
Department of Economics
Columbia University
420 West 118 Street
New York NY 10027
E-Mail: st2511@columbia.edu
AB  - We study the competitive equilibrium of a market for votes where voters can trade votes for a numeraire before making a decision via majority rule. The choice is binary and the number of supporters of either alternative is known.  We identify a sufficient condition guaranteeing the existence of an ex ante equilibrium. In equilibrium, only the most intense voter on each side demands votes and each demands enough votes to alone control a majority. The probability of a minority victory is independent of the size of the minority and converges to one half, for any minority size, when the electorate is arbitrarily large. In a large electorate, the numerical advantage of the majority becomes irrelevant: democracy is undone by the market.
ER  -