An analysis of welfare effects of legislative term limits

This paper analyzes the welfare effects of term limits for state legislator s. Legislators tend to pursue their own objectives and deviate from the int erests of voters as they stay longer in office. However, such long-term inc umbents become more productive in transferring wealth to their constituents due to seniority they gain, and voters re-elect the incumbent. Term limits reduce the maximum seniority of a district's legislator and of other distr icts' legislators as well, affecting the relative seniority of the legislat or. Thus, the legislator gains relative seniority sometimes and loses other times under term limits. As a consequence, voters of a district may or may not benefit from term limits. The welfare effects of term limits depend cr ucially on the shape of the voters' utility function.