Working Paper: CEPR ID: DP17044
Authors: Hans Gersbach; Akaki Mamageishvili; Manvir Schneider
Abstract: We study vote delegation and compare it with conventional voting. Typical examples for vote delegation are validation or governance tasks on blockchains and liquid democracy. There is a majority of "well-behaving" agents, but they may abstain or delegate their vote to other agents since voting is costly. "Misbehaving" agents always vote. Preferences of agents are private information and a positive outcome is achieved if well-behaving agents win. Vote delegation can lead to quite different outcomes than conventional voting. For instance, if the number of misbehaving voters, denoted by f, is high, both voting methods fail to deliver a positive outcome. If the number of misbehaving voters takes an intermediate value, conventional voting delivers a positive outcome, while vote delegation fails with probability one. However, if f is low, weshow by numerical simulations that delegation delivers a positive outcome with higher probability than conventional voting. Our results also provide insights in worst-case outcomes that can happen in a liquid democracy.
Keywords: costly voting; delegation; rational voters; governance; liquid democracy; blockchain
JEL Codes: C72; D71; D72; D8
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| high number of misbehaving voters (f) (K16) | negative outcomes in both voting methods (D72) |
| moderate number of misbehaving voters (f) (D72) | positive outcome in conventional voting (D72) |
| moderate number of misbehaving voters (f) (D72) | vote delegation fails (D72) |
| low number of misbehaving voters (f) (K16) | vote delegation results in a positive outcome (D72) |
| low number of misbehaving voters (f) (K16) | well-behaving agents benefit more from delegation (L20) |
| accumulation of misbehaving voters (D72) | vote delegation becomes risky (D72) |