Equilibrium and Efficiency in an Organized Vote Market.

The authors study an organized market for votes in which trade is directed by a market 'specialist.' This market mechanism always produces an equilibrium outcome and, whenever vote buying occurs, the alternative chosen is Pareto superior to the alternative that would be chosen without trade. The authors then characterize the equilibrium outcomes in a one-dimensional policy space and show that, if the distribution of ideal points is skewed enough, then the equilibrium with vote buying differs from the equilibrium without vote buying (the median ideal point). This difference reflects the ability of an intense minority to obtain a policy it prefers in exchange for side payments. Copyright 1996 by Kluwer Academic Publishers