Logrolling: An Example
Table 1-1 below explains another example of logrolling. In the example, we have three individuals: Tanis, Alvin, and Rebekah. Tanis favors subsidies for agriculture, Alvin favors school construction, and Rebekah favors the recruitment of more firefighters. It seems as if the proposals are doomed to fail because each is opposed by a majority of voters. Even so, this may not be the outcome. Tanis may visit Rebekah and tell her that she will vote for Rebekah’s bill to recruit more firefighters as long as Rebekah votes for her policy, subsidies for agriculture, in return. Now, both proposals will win because they have gained a simple majority, even though in reality the subsidy is opposed by two of the three voters. It’s easy to see the Coase theorem at work in examples like this. Here, transaction costs are low, so mutually beneficial agreements are found, and the person who values the service the most will hold it (Browning and Browning 1979). Still, outcomes may be inefficient.
| Table 1-1 | Agriculture | Tax | Vote | School | Tax | Vote | Fire | Tax | Vote | |
|---|---|---|---|---|---|---|---|---|---|---|
| Tannis | $300 | $200 | Y | $150 | $200 | N | $100 | $200 | N | |
| Alvin | $150 | $200 | N | $350 | $200 | Y | $150 | $200 | N | |
| Rebekah | $100 | $200 | N | $50 | $200 | N | $225 | $200 | Y | |
| Total | $550 | $600 | Inefficient | $550 | $600 | Inefficient | $475 | $600 | Inefficient |
Read more about this topic: Logrolling, Concept and Origin