Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/76609 
Year of Publication: 
2003
Series/Report no.: 
CESifo Working Paper No. 1104
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
This paper investigates the merits of different democratic institutions when politics is uni-dimensional, there is uncertainty both about the preferences of the future electorate and the future polarization of political parties, and politicians have better information about the state of the world than voters. Three types of institutions are compared: direct democracy, representative democracy, where politicians are accountable and independent agencies, where they are not. Low uncertainty about the state of the world and the future electorate's preferences and high expected polarization make direct democracy optimal, while the opposite configuration makes representative democracy optimal. Independent agencies are optimal for intermediate values.
Subjects: 
accountability
redistribution
constitutional design
voting
information
direct democracy
JEL: 
H10
H70
K40
Document Type: 
Working Paper
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