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Vote-share Contracts and Democracy

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  • Gersbach, Hans

Abstract

In this paper we introduce vote-share contracts. Such contracts contain a vote-share threshold that incumbents must reach in order to be reelected. In a simple model, we illustrate the working of vote-share contracts. Such vote-share contracts curb socially detrimental incumbency advantages by improving the average ability level of re-elected politicians and also increase effort. We show that the socially optimal vote-share threshold for incumbents is larger than one half. Competing candidates offer vote-share contracts with socially optimal thresholds.

Suggested Citation

  • Gersbach, Hans, 2007. "Vote-share Contracts and Democracy," CEPR Discussion Papers 6497, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:6497
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Hans Gersbach & Markus Müller, 2017. "Higher bars for incumbents and experience," Journal of Theoretical Politics, , vol. 29(3), pages 492-513, July.
    2. Francesco Caselli & Tom Cunningham & Massimo Morelli & Inés Moreno de Barreda, 2012. "Signalling, Incumbency Advantage, and Optimal Reelection Rules," CEP Discussion Papers dp1122, Centre for Economic Performance, LSE.
    3. Gersbach, Hans, 2017. "Flexible Majority Rules in democracyville: A guided tour," Mathematical Social Sciences, Elsevier, vol. 85(C), pages 37-43.
    4. Caselli, Francesco & Morelli, Massimo & Moreno de Barreda, Inés & Cunningham, Tom, 2012. "Signalling, Incumbency Advantage, and Optimal Reelection Thresholds," CEPR Discussion Papers 8832, C.E.P.R. Discussion Papers.
    5. Hans Gersbach & Verena Liessem, 2008. "Reelection threshold contracts in politics," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 31(2), pages 233-255, August.
    6. Markus Müller, 2009. "Vote-Share Contracts and Learning-by-Doing," CER-ETH Economics working paper series 09/114, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
    7. Gersbach, Hans, 2009. "Higher Vote Thresholds for Incumbents, Effort and Selection," CEPR Discussion Papers 7320, C.E.P.R. Discussion Papers.

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    More about this item

    Keywords

    Elections; Political contracts; Vote-share thresholds;
    All these keywords.

    JEL classification:

    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • H4 - Public Economics - - Publicly Provided Goods

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