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Bundling and the Unanimity Rule

Author

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  • Gersbach, Hans
  • Erlenmaier, Ulrich

Abstract

In this Paper, we design democratic constitutions that can transcend the shortcomings of the unanimity rule. The constitution embeds the unanimity rule in a set of virtue-supporting principles: (a) broad packages with many public projects (bundling) are allowed, but can only be proposed once in a legislative term; (b) the person who designs the package is also taxed at the highest proposed rate; and (c) subsidies are forbidden. We show that such democratic constitutions can yield efficient public project provision.

Suggested Citation

  • Gersbach, Hans & Erlenmaier, Ulrich, 2004. "Bundling and the Unanimity Rule," CEPR Discussion Papers 4808, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:4808
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    Cited by:

    1. Berglöf, Erik & Burkart, Mike & Friebel, Guido & Paltseva, Elena, 2012. "Club-in-the-club: Reform under unanimity," Journal of Comparative Economics, Elsevier, vol. 40(3), pages 492-507.

    More about this item

    Keywords

    Unanimity rule; Bundling; Constitutions; Provision of public projects; Amendment rules;
    All these keywords.

    JEL classification:

    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • H40 - Public Economics - - Publicly Provided Goods - - - General

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