A MODEL OF POLITICAL EQUILIBRIUM IN A REPRESENTATIVE DEMOCRACY

This paper studies political equilibrium in a two-party representative democracy in which the political parties are policy motivated and vot ers trade off their policy preferences against their 'party identity'. It is shown that the parties will in general adopt differing policy p ositions in equilibrium, and that, under certain qualifications, the w inning policy will lie between the more popular party's preferred poli cy and a certain utilitarian optimum. The winning policy will be close r to this utilitarian optimum the less biased the electorate is in ter ms of 'party identification'.