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Scale economies and rent-seeking in legislative parties

Kenneth Koford

Public Choice, 1987, vol. 52, issue 1, 35-55

Abstract: This paper examines equilibrium legislative party size, based upon scale economies in producing political outcomes. Political production — finding policies legislators desire and vote-trading to pass them — has strong scale economies up to, but not far beyond, a majority of the voters. Either one or two parties is efficient, but a larger number is not. A single party's optimal long-run strategy is to benefit a dominant majority by avoiding the creation of an effective second party. But short-term rent-seeking is in legislators' and leaders' interests, which eventually causes a second effective party and a stable two-party equilibrium. Estimates of party size for the U.S. Congress suggest considerable short-term rent-seeking. Copyright Martinus Nijhoff Publishers 1987

Date: 1987
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DOI: 10.1007/BF00116942

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