DP12672 | Balanced Voting

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We introduce 'Balanced Voting', a voting scheme tailored to fundamental societal decisions. It works as follows: Citizens may abstain from voting on a fundamental direction in a first stage. This guarantees the voting right in a second voting stage on the variants of the fundamental direction chosen in the first. All losers from the first stage also obtain voting rights in the second stage, while winners do not. We develop a model with two fundamental directions and variants of these directions. Information about the preferences is private. We identify circumstances under which Balanced Voting performs well with regard to utilitarian welfare and Pareto dominance. We discuss the robustness of the results, procedural rules to implement the voting scheme, and extensions. Moreover, we provide several examples, such as the US presidential election, for which the scheme could be applied.