Majority rule with dollar voting

James S. Jordan

Research output: Contribution to journalArticlepeer-review

1 Scopus citations

Abstract

Consider a majority game in which each player's voting strength is equal to the player's payoff. In this game, wealth is the only source of power, and any coalition with more than half the wealth can take everything. Only extreme concentrations of wealth, in which one player owns everything or two players each own half the total wealth are undominated, and thus constitute the core. However, the stable set (von Neumann-Morgenstern solution) is significantly larger. Allocations in which one player has half the wealth, or which divide the total wealth equally among a number of players equal to a power of two, constitute the unique stable set. The stable set thus provides a formal model of an endogenous balance of power.

Original languageEnglish (US)
Pages (from-to)343-352
Number of pages10
JournalReview of Economic Design
Volume6
Issue number3-4
DOIs
StatePublished - Jan 1 2001

All Science Journal Classification (ASJC) codes

  • Economics, Econometrics and Finance(all)

Fingerprint Dive into the research topics of 'Majority rule with dollar voting'. Together they form a unique fingerprint.

Cite this