Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/78396 
Authors: 
Year of Publication: 
2000
Series/Report no.: 
Bonn Econ Discussion Papers No. 18/2000
Publisher: 
University of Bonn, Bonn Graduate School of Economics (BGSE), Bonn
Abstract: 
The paper studies the relative merits of direct and representative legislation in a setting where voters are uncertain both with respect to the likely consequences of different policies and with respect to the political preferences of their fellow citizens. Under representative legislation, the latter translates into uncertainty on the elected official's future policy intentions which involves a loss of control. The resulting discretionary power, however, also leads officials to endogenously acquire competence on the issues they oversee and specialize in policy formation. Policies determined in representative democracies are therefore better tailored to relevant contingencies but less close to the preferences of a majority than those determined in popular ballots. It is shown that the extent of the resulting trade-off depends on the set of alternatives among which the policy is to be chosen. Two extensions, referenda and the possibility of re-election, are briefly considered.
Subjects: 
Direct Democracy
Representative Democracy
Constitutional Choice
Delegation
Asymmetric Information
JEL: 
D61
D78
Document Type: 
Working Paper

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