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Following the rationale for regional redistribution programs described in the official documents of the European Union, this paper studies a very simple multi-country model built around two regions: a core and a periphery. Technological spill-overs link firms' productivity in each of the two region, and each country's territory falls partly in the core and partly in the periphery, but the exact shares vary across countries. We find that, in line with the EU view, the efficient regional allocation requires both national and international transfers. If migration is fully free across all borders, then optimal redistribution policy results from countries' uncoordinated policies, obviating the need for a central agency. But if countries have the option of setting even imperfect border barriers, then efficiency is likely to require coordination on both barriers and international transfers (both of which will be set optimally at positive levels). The need for coordination increases as the Union increases in size.

Motivated by the need for more flexible decision-making mechanisms in the European Union, the paper proposes a simple but novel voting scheme for binary decisions taken by committees that meet regularly over time. At each meeting, committee members are allowed to store their vote for future use; the decision is then taken according to the majority of votes cast. The possibility of shifting votes intertemporally allows agents to concentrate their votes when preferences are more intense, and although the scheme will not in general achieve full efficiency, making votes storable typically leads to ex ante welfare gains. The analysis in the paper suggests that the result will hold if one of the following conditions is satisfied: (i) the number of voters is above a minimum threshold; (ii) preferences are not too polarized; (iii) the horizon is long enough.

We study the competitive equilibrium of a market for votes where voters can trade votes for a numeraire before making a decision via majority rule. The choice is binary and the number of supporters of either alternative is known. We identify a sufficient condition guaranteeing the existence of an ex ante equilibrium. In equilibrium, only the most intense voter on each side demands votes and each demand enough votes to alone control a majority. The probability of a minority victory is independent of the size of the minority and converges to one half, for any minority size, when the electorate is arbitrarily large. In a large electorate, the numerical advantage of the majority becomes irrelevant: democracy is undone by the market.

Mechanism design teaches us that a mediator can strictly improve the chances of peace between two opponents even when the mediator has no independent resources, is less informed than the two parties, and has no enforcement power. We test the theory in a lab experiment where two subjects negotiate how to share a resource; in case of conflict, the subjects' privately known strength determines their payoffs. The subjects send cheap talk messages about their strength to one another (in the treatment with direct communication) or to the mediator (in the mediation treatment), before making their demands or receiving the mediator's recommendations. We find that, in line with the theory, messages are significantly more sincere when sent to the mediator. However, contrary to the theory, peaceful resolution is not more frequent, even when the mediator is a computer implementing the optimal mediation program. While the theoretical result refers to the best (i.e. most peaceful) equilibrium under mediation, multiple equilibria exist, and the best equilibrium is particularly vulnerable to small deviations from full truthfulness. Subjects are not erratic and their deviations induce only small losses in payoffs, and yet they translate into significant increases in conflict.

In polarized committees, majority voting disenfranchises the minority. Allowing voters to spend freely a fixed budget of votes over multiple issues restores some minority power. However, it also creates a complex strategic scenario: a hide-and-seek game between majority and minority voters that corresponds to a decentralized version of the Colonel Blotto game. We offer theoretical results and bring the game to the laboratory. The minority wins as frequently as theory predicts, despite subjects deviating from equilibrium strategies. Because subjects understand the logic of the game — minority voters must concentrate votes unpredictably — the exact choices are of secondary importance.

Democratic systems are built, with good reason, on majoritarian principles, but their legitimacy requires the protection of strongly held minority preferences. The challenge is to do so while treating every voter equally and preserving aggregate welfare. One possible solution is storable votes: granting each voter a budget of votes to cast as desired over multiple decisions. During the 2006 student elections at Columbia University, we tested a simple version of this idea: voters were asked to rank the importance of the different contests and to choose where to cast a single extra "bonus vote," had one been available. We used these responses to construct distributions of intensities and electoral outcomes, both without and with the bonus vote. Bootstrapping techniques provided estimates of the probable impact of the bonus vote. The bonus vote performs well: when minority preferences are particularly intense, the minority wins at least one of the contests with 15.30 percent probability; and, when the minority wins, aggregate welfare increases with 85.95 percent probability. When majority and minority preferences are equally intense, the effect of the bonus vote is smaller and more variable but on balance still positive.

The legitimacy of democratic systems requires the protection of minority preferences while ideally treating every voter equally. During the 2006 student elections at Columbia University, we asked voters to rank the importance of different contests and to choose where to cast a single extra "bonus vote," had one been available — a simple version of Storable Votes. We then constructed distributions of intensities and electoral outcomes and estimated the probable impact of the bonus vote through bootstrapping techniques. The bonus vote performs well: when minority preferences are particularly intense, the minority wins at least one contest with 15-30 percent probability; when the minority wins, aggregate welfare increases with 85-95 percent probability. The paper makes two contributions: it tests the performance of storable votes in a setting where preferences were not controlled, and it suggests the use of bootstrapping techniques when appropriate replications of the data cannot be obtained.

Democratic systems are built, with good reason, on majoritarian principles, but their legitimacy requires the protection of strongly held minority preferences. The challenge is to do so while treating every voter equally and preserving aggregate welfare. One possible solution is storable votes: granting each voter a budget of votes to cast as desired over multiple decisions. During the 2006 student elections at Columbia University, we tested a simple version of this idea: voters were asked to rank the importance of the different contests and to choose where to cast a single extra "bonus vote," had one been available. We used these responses to construct distributions of intensities and electoral outcomes, both without and with the bonus vote. Bootstrapping techniques provided estimates of the probable impact of the bonus vote. The bonus vote performs well: when minority preferences are particularly intense, the minority wins at least one of the contests with 15-30 percent probability; and, when the minority wins, aggregate welfare increases with 85-95 percent probability. When majority and minority preferences are equally intense, the effect of the bonus vote is smaller and more variable but on balance still positive.