Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/76097
Authors: 
Gersbach, Hans
Year of Publication: 
2002
Series/Report no.: 
CESifo Working Paper 749
Abstract: 
We introduce democratic mechanisms where individual utilities are not observable by other people at the legislative stage. We show that the combination of three rules can yield e±cient provision of public projects: first, flexible and double majority rules where the size of the majority depends on the proposal and taxed and non-taxed individuals need to support the proposal; second, flexible agenda costs where the agenda-setter has to pay a certain amount of money if his proposal does not generate enough supporting votes; third, a ban on subsidies. We also illustrate that higher dimensional uncertainty about project parameters can make it easier to achieve first-best allocations and that universal equal treatment with regard to taxation is undesirable.
Subjects: 
democratic constitutions
unobservable utilities
double majority rules
flexible agenda cost rules
JEL: 
D62
D72
H40
Document Type: 
Working Paper

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