The last decade has seen the burgeoning of several hundred local community currency institutions in cities across the world. Although residents of these communities claim that local currency promotes local development, how if at all it does so has hitherto been unexplored. This paper argues that...

We study a game theoretic model of a parliamentary democracy under proportional representation where `citizen candidates' form parties, voting occurs and governments are formed. We study the coalition governments that emerge as functions of the parties' seat shares, the size of the rents from...

We analyze the relative importance of party ideology and rents from office in the formation of coalitions in a parliamentary democracy. In equilibrium, the types of coalitions that are formed may be minimal winning, minority or surplus and they may be ideologically `disconnected'. The coalitions...

We analyze the relative importance of party ideology and rents from office in the formation of coalitions in a parliamentary democracy. In equilibrium, the types of coalitions that are formed may be minimal winning, minority or surplus and they may be ideologically `disconnected'. The coalitions...

Countries that elect their policy-makers by means of Plurality Voting tend to have a two-party system. This observation can be explained by the strategic behavior of voters. The present paper derives two broad classes of voting procedures under which strategic voting behavior induces a two-party...

Whom should an interest group lobby in a legislature? I develop a model of informational lobbying in which a legislature must decide on the allocation of a local publicly-provided good across districts. An interest group chooses sequentially to search and provide information on districts'...

Countries that elect their policy-makers by means of Plurality Voting tend to have a two-party system. We conduct laboratory experiments to study whether alternative voting procedures yield a two-party system as well. Plurality Voting is compared with Approval Voting and Dual Voting, both of...

An important question in political economics concerns delays in the adoption of socially beneficial reforms. The present paper explores this issue in the context of a representative democracy where the government is a coalition and citizens observe neither the decision-making process, nor the...

We challenge the prevailing view that pure informational lobbying (in the absence of political contributions and evidence distortion or withholding) leads to better informed policymaking. In the absence of lobbying, the policymaker may prioritize more-promising issues. Recognizing this, interest...