An economic model of the demand and supply of votes : some tentative empirical results

Abstract

The electoral process is an integral part of democratic decision-making. It is traditionally viewed as the one means by which those governed make known their preferences regarding the rules by which they wish to be constrained. In recent years, economists have become interested in developing a theory of the economic aspects of this important process of public choice. This study is an attempt to bring together the contributions to the development of this theory and to specify and test an integrated model which is consistent with the present state of our knowledge. The intellectual impetus behind this incursion by economists into the domain of political scientists is a book by Anthony Downs which appeared in 1957. In his An Economic Theory of Democracy, Downs develops a model of the electoral process in which votes are trades for policies and actions. Politicians demand votes as a means of gaining and holding public office. Voters supply these votes in return for policies and actions by the government which will make them better off. Since the appearance of Downs' book, a number of writers have specified and tested empirical models of either the supply of votes or the demand for votes. After reviewing this literature, a simultaneous equations model of the demand and supply of votes is specified and tested in an attempt to determine the degree to which a theory implied by the recent contributions is in agreement with observable data.