Discussion Paper Details

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Title: Bundling and the Unanimity Rule

Author(s): Ulrich Erlenmaier and Hans Gersbach

Publication Date: December 2004

Keyword(s): amendment rules, bundling, constitutions, provision of public projects and unanimity rule

Programme Area(s): Public Economics

Abstract: In this Paper, we design democratic constitutions that can transcend the shortcomings of the unanimity rule. The constitution embeds the unanimity rule in a set of virtue-supporting principles: (a) broad packages with many public projects (bundling) are allowed, but can only be proposed once in a legislative term; (b) the person who designs the package is also taxed at the highest proposed rate; and (c) subsidies are forbidden. We show that such democratic constitutions can yield efficient public project provision.

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Bibliographic Reference

Erlenmaier, U and Gersbach, H. 2004. 'Bundling and the Unanimity Rule'. London, Centre for Economic Policy Research.