Inducing Cooperation through Weighted Voting and Veto Power

Abstract

We study the design of voting rules for committees representing heterogeneous groups (countries, states, districts) when cooperation among groups is voluntary. While efficiency recommends weighting groups proportionally to their stakes, we show that accounting for participation constraints entails overweighting some groups, those for which the incentive to cooperate is the lowest. When collective decisions are not enforceable, cooperation induces more stringent constraints that may require granting veto power to certain groups. In the benchmark case where groups differ only in their population size (i.e., the apportionment problem), the model provides a rationale for setting a minimum representation for smaller groups. (JEL C73, D71, D72)