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Voting on standardisation

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Abstract

This paper analyses equilibria of voting on commodity standards within the framework of a Farrell-Saloner model which takes into consideration the trade-off between network effects and losses from a reduction of variety. Social welfare implications are derived and discussed with respect to manipulations of majority rules. The findings indicate that welfare implications of standards are highly sensitive to the decision procedure and that the choice of the decision rule is non-trivial as it can at least prevent worst outcomes if not guarantee optimal results.

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Authors and Affiliations

  1. Institute of Economics, University of Hamburg, Von-Melle-Park 5, D-20146, Hamburg

    Laszlo Goerke & Manfred J. Holler

Authors
  1. Laszlo Goerke
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  2. Manfred J. Holler
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Additional information

This paper has been presented at the Conference of the European Public Choice Society (1994) in Valencia and the Second Workshop in Applied Game Theory (1993) in Hamburg. We are grateful for the comments we received but have to claim sole responsibility for the resulting product.

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Goerke, L., Holler, M.J. Voting on standardisation. Public Choice 83, 337–351 (1995). https://doi.org/10.1007/BF01047751

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  • DOI: https://doi.org/10.1007/BF01047751

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