ECO 2110 Chapter Notes - Chapter 8: Voting Paradox
9 Apr 2018
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Document Summary
Public choice models assume that individuals view government as a mechanism for maximizing their well-being. Because people are selfish, public goods are under provided even though everyone could be made better off if they were provided in efficient amounts. Instead of each individual facing the same price, each faces a personalized price per unit of public good, which depends on their tax share. Equilibrium is a set of lindahl prices such that at those prices each person votes for the same quantity of the public good. One more than half of the voters must favor a measure for it to be approved. Voting paradox each individual voters preferences are consistent, the communities are not. Agenda manipulation process of organizing the order of votes to assure a favorable outcome. Peak point at which all the neighbouring points are lower (individual preferences) Voter has single peaked preferences is her utility consistently falls as you move away from the peak.
