Equal representation in two-tier voting systems

The paper investigates how voting weights should be assigned to differently sized constituencies of an assembly. The one-person, one-vote principle is interpreted as calling for a priori equal indirect influence on decisions. The latter are elements of a one-dimensional convex policy space and may result from strategic behavior consistent with the median voter theorem. Numerous artificial constituency configurations, the EU and the US are investigated by Monte-Carlo simulations. Penrose’s square root rule, which originally applies to preference-free dichotomous decision environments and holds only under very specific conditions, comes close to ensuring equal representation. It is thus more robust than previously suggested

Electoral Rules and Politicians’ Behavior: A Micro Test

Theory predicts that the majoritarian electoral system should produce more targeted redistribution and lower politicians’ rents than proportional representation. We test these predictions using micro data for the mixed-member Italian House of Representatives, which allow us to sidestep the identification problems of previous studies based on country-level data. In particular, we address the nonrandom selection into different electoral systems by exploiting a distinctive feature of the Italian two-tier elections from 1994 to 2006: candidates could run for both the majoritarian and the proportional tier, but if they won in both tiers they had to accept the majoritarian seat. Focusing on elections decided by a narrow margin allows us to generate quasi-experimental estimates of the impact of the electoral rule. The main results confirm theoretical predictions, as majoritarian representatives put forward a higher proportion of bills targeted at local areas and show lower absenteeism rates than their proportional colleagues.electoral rule, politicians, targeted redistribution, rent-seeking, regression discontinuity design, treatment effect

A Corporate Governance Index: Convergence and Diversity of National Corporate Governance Regulations

The issue of appropriate corporate governance framework has been a focal point of recent reforms in many countries. This study provides a comprehensive comparative analysis of corporate governance regulatory systems and their evolution over the last 15 years in 30 European countries and the US. It proposes a methodology to create detailed corporate governance indices which capture the major features of capital market laws in the analysed countries. The indices indicate how the law in each country addresses various potential agency conflicts between corporate constituencies: namely, between shareholder and managers, between majority and minority shareholders, and between shareholders and bondholders. The analysis of regulatory provisions within the suggested framework enables us to understand better how corporate law works in a particular country and which strategies regulators adopt to achieve their goals. The 15-year time series of constructed indices and large country-coverage (30 European countries and the US) also allows us to draw conclusions about the convergence of corporate governance regimes across the countries. To our best knowledge, this is the first study that intends to address the convergence debate empirically. The analysis is based on a unique corporate governance database that comprises the main changes in corporate governance regulations in the US and all European countries between 1990-2005.governance regulation;convergence;corporate governance;agency problem;ownership and control;LLSV

Comparative Politics of Strategic Voting: A Hierarchy of Electoral Systems

What is the impact of electoral rules on the way people make decisions in the voting booth? Traditionally the literature about electoral systems argues that the size of the district magnitude determines the amount of strategic voting. I argue, however, that different electoral systems provide incentives that potentially undermine or facilitate the Duvergerian logic in practice. Contrary to the literature the results indicate that the impact of the district magnitude on the frequency of strategic voting in a given polity is conditional on the type of seat allocation system that defines how votes get translated into parliamentary seats.

Cyprus as the Lighthouse of the East Mediterranean: Shaping EU Accession and Reunification Together. CEPS Paperback. April 2002

For over a quarter of a century, Cyprus has been a divided island, with Europe’s last remaining ‘Berlin Wall’ separating its Greek and Turkish Cypriot communities. This stalemate between the regions, however, is finally beginning to dissolve. Negotiations are currently underway to resolve the Cyprus conflict, re-unify the island and secure the accession of the whole of Cyprus to the EU in the near future. This CEPS report explores the ways in which these developments might come about. The authors argue that simultaneous action could transform the political structures and interests that have up until now made it impossible to resolve the division of the island

The Measurement of Firm Ownership and its Effect on Managerial Pay

This paper uses German evidence to address two questions about corporate governance. The effects of ownership on corporate governance have received much recent attention, but very little of this has been devoted to the appropriate way to measure firm ownership. The results of this paper show that the conclusions reached about the effects of ownership on corporate governance can depend critically on the particular ownership measure used, and that the widely-used weakest-link principle is wholly unsatisfactory as a means of dealing with the issues raised by pyramid ownership structures. The paper also shows that greater ownership concentration typically weakens the link between managerial pay and firm profitability. This is inconsistent with the hypothesis, emphasised in the recent literature on the USA, that large owners are a complement to, rather than a substitute for, such a link.

Square root voting system, optimal threshold and \pi

The problem of designing an optimal weighted voting system for the two-tier voting, applicable in the case of the Council of Ministers of the European Union (EU), is investigated. Various arguments in favour of the square root voting system, where the voting weights of member states are proportional to the square root of their population are discussed and a link between this solution and the random walk in the one-dimensional lattice is established. It is known that the voting power of every member state is approximately equal to its voting weight, if the threshold q for the qualified majority in the voting body is optimally chosen. We analyze the square root voting system for a generic 'union' of M states and derive in this case an explicit approximate formula for the level of the optimal threshold: q \simeq 1/2+1/\sqrt{{\pi} M}. The prefactor 1/\sqrt{{\pi}} appears here as a result of averaging over the ensemble of unions with random populations.Comment: revised version, 21 pages in late