R“Ok, now we need to calibrate the government so that Warren doesn’t overshadow all the people who were not elected.” Eh???? Then why should people bother voting in the first place?

I think this is something quite different.

There are two important ways in which markets and government differ.

First: policy options are generally mutually exclusive. You can’t have a liberal abortion policy *and* a restrictive one at the same time. You can’t be in the EU and out if the EU at the same time. Markets generally don’t have this characteristic. The availability of Dan Brown books does not directly conflict with the availability of the Wealth of Nations, and both can easily exist along side one another. You can have more of one without that necessarily meaning less of the other.

Second: markets function very well even if different people’s capacity to buy stuff can differ widely. Supply of goods and services to people with small budgets is not materially smaller than to people with large budgets, even though the purchasing power of the latter is much greater. A system of government in which the degree to which a person could influence policy was proportional to their wealth would deviate from a key principle of most forms of democracy: one person one vote.

So if all we want to do is allow every person to express the intensity of their preferences, we need to be careful to take these differences into account when we introduce scarcity into the political process.

The requirement we should seek to meet is that every person has the same capability of expressing the intensity of their preferences. Holbo makes a good point (on a slightly related note: #1 is what kills the NHS in the UK – being free of charge at the point of use means you have overconsumption by people with spare time): the three possibilities he lists fail to meet that requirement. In contrast, with a suitably chosen unit price, you would bring multiple votes within reach of everyone including the really poor, while avoiding abuse by single or small groups of individuals. Abuse by large groups of individuals would not be a flaw, it is a design feature.

It is not because lots of people buy Holbo’s book that he therefore is entitled to have more say in public policy setting than those who buy his books. But it *is* because lots of people voted for Warren that she got elected – again that is a feature. (As an aside, perhaps MPs here in the UK, or congressmen in the US, should have more say in the legislature according to the size of their majority – the intensity of the preference of their electorate is not recognized at all, and maybe it should be!)

Recalibration is, in my view, essential in the political process, if you do not want to disadvantage certain groups. But this would not be putting obstacles in the way of people in the sense that you describe – making it difficult to signal your preference.

Real markets are about allocating scarce economic resources to the production of economic goods and services. Interfering in this would inevitably lead to suboptimal outcomes.

Government is about translating the desires of the population into policy. Current systems give every person at most one vote, giving them a choice between apathy and non-apathy. The limit of one vote is not an obstacle, yet the process is unsatisfactory because of the lack of nuance, and so increasing the potential number of votes addresses that problem. But you also need to introduce scarcity to avoid the Spinal Tap ‘amp that goes to 11' phenomenon whereby everyone cranks up their volume to the max. Making it quadratic ensures that allowing the expression of intensity of preference is all you do, without the unintended side effect that the wealthy control policy.

Your point about wealth being a function of the desirability of what they supply would make sense in general (though not in the political process), were it not for the fact that not all wealth stems from economic transactions that reflect the creation of value – inheritance or windfalls for example (as you seem to say yourself anyway).

But if it’s truly beneficial to take people’s valuations into account… then quadratic voting is inferior to straight vote buying/selling

Take your prohibition example (great one! I will probably steal that for a blogpost one day :-)). In an individual economic transaction, our relative wealth should not really matter. I don’t have enough money to buy a Ferrari, and there is no reason why any intervention should be made to allow me to get one if I really wanted one. In aggregate, if enough people both want and can afford a Ferrari, someone will build them. There is no policy for or against Ferraris though. But if a small number of rich people would rather have large tax cuts than continue Medicare, then if they can express their preference by buying an unlimited number of votes they will be able to outvote a large number of poor voters whose intensity of preference is no smaller, but whose ability to back it up with cash is.

As I said, that situation is not a problem in markets where distinct choices can freely coexist. But it is a problem in policy setting.