Public Choice

, Volume 83, Issue 3–4, pp 337–351 | Cite as

Voting on standardisation

  • Laszlo Goerke
  • Manfred J. Holler
Article

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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Copyright information

© Kluwer Academic Publishers 1995

Authors and Affiliations

  • Laszlo Goerke
    • 1
  • Manfred J. Holler
    • 1
  1. 1.Institute of EconomicsUniversity of HamburgHamburg

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