Messner Polborn (2004) - Voting On Majority Rules
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Messner, M. and M. Polborn (2004), Voting on Majority Rules, Review of Economic Studies 71(1), 115-132. pdf
We analyse an overlapping generations model of voting on "reform projects". These resemble investments in that they first require some investment expenditure and later payoff. Since the time during which old people get the benefit is shorter, or because older people are more wealthy and hence pay more taxes, they are more conservative (against reforms) than young people. We show that if people vote on which majority should be required in future elections for a bill to become a law, the winning proposal specifies a supermajority. This result is very robust even if age related conflict is only one determinant among others for voting behaviour in the society.
Question: Why do we ever observe supermajorities?
Unit mass of voters who are born in continuous time and live for 1 period. Deaths exactly compensate for births, so mass of voters constant at 1. Some chance [math]\lambda dt\lt math\gt that a reform opportunity may appear at each point in time (e.g., chance to open up trade). The value \lt math\gt v[/math] of the reform will not be known until the time of voting.