Imperfect Information, Democracy, and Populism

Johannes Binswanger () and Jens Prüfer ()

No 2009-10, Discussion Paper from Tilburg University, Center for Economic Research

Abstract: The modern world is complex and difficult to understand for voters, who may hold beliefs that are at variance with reality. Politicians face incentives to pander to voters' beliefs to get reelected. We analyze the welfare effects of this pandering and show that it entails both costs and benefits. Moreover, we explore optimal constitutional design in the presence of imperfect information about how the world works. We compare indirect democracy to direct democracy and to delegation of policy making to independent agents. We find that indirect democracy is often welfare maximizing.

JEL-codes: D72 D78 D83 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cdm, nep-cta and nep-pol
Date: 2009

Downloads: (external link)
http://arno.uvt.nl/show.cgi?fid=90622 (application/pdf)

Related works:
Working Paper: Imperfect Information, Democracy and Populism (2008)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:dgr:kubcen:200910

Access Statistics for this paper

More papers in Discussion Paper from Tilburg University, Center for Economic Research
Series data maintained by Corry Stuyts ().