At the Freakonomics blog, Ryan Hagen asks, Is it Smarter to Sell Your Vote or Cast It? A recent poll asked students at NYU whether they would sell their right to vote either in the next election or in perpetuity for a variety of proposed compensations. It turns out that over 60% of them would sell their 2008 vote for a year's tuition, and around 50% would sell their vote in perpetuity for $1 million.
What is a vote really worth? The poll questions seem to concentrate solely on the supply side (i.e., what would students sell their votes for, irrespective of whether there is anyone actually willing to pay that), which would suggest that we're trying to get at voters' personal valuation of their voting rights, all else being equal. So, let's assume that this opportunity is being offered to me only. The effect of my individual vote on the election's outcome is for all practical purposes nil, so from the standpoint of influencing the results of the election it is worth nothing. However, I do derive some personal satisfaction from voting that, on reflection, I'd value at a few tens of dollars; $50 would be a reasonable estimate. So, I should be willing to sell my vote for anything more than $50 (although I'd try to get the best price I could, of course). To sell my vote in perpetuity I'd want the discounted value of all of those future $50 votes. At first blush I might want some sort of risk premium, in case there might be some election in the future that I really want to influence, but since my probability of successfully influencing such an election is so small, that component is basically negligible. Depending on what discount rate you assume, that works out to about $2000 (assuming only one vote per year; if you include primaries and such it could come to several times that). Considering how many people voluntarily abstain from voting for no compensation at all, that seems like a reasonable number.
If we consider the possibility of the same deal being offered to everybody, then it gets a little harder to calculate a reasonable price. It's not too difficult to come up with our buying price for such a scenario. One or another candidate is bound to favor policies that will either cost us money directly or eliminate some benefit that we previously enjoyed. With a little work we could attach a value to those policy differences. To use myself as an example, my interaction with the government is primarily through taxes, but some policies might affect the costs of things I use. Let's say, for the sake of argument, that the present value of the benefit comes to $20k (although the fact that I would have a hard time telling you which side provides the benefit suggests that the number is actually much smaller than that). Suppose it takes about 5M votes to change the results of a large election. Then we're looking at about half a cent per vote. Clearly vote buying isn't a good strategy for little old me. For someone more entangled with government the total would be higher; someone standing to gain a billion dollars from having his candidate elected should be willing to pay $200 per vote in our example.
Clearly a rational selling price should be higher than the buying price, but how much? The total benefit from the preferred candidate winning provides an upper bound, since that price fully compensates the seller for having the unfavorable candidate win, but should he be willing to accept less? That depends on the probability that the seller and others like him will actually change the results of the election through the sale of their votes. For example, if you think there are 10:1 odds against your vote sale affecting the election, then you might be willing to accept $2000 for your vote. The exact odds calculation depends on who's buying and what their motivation is, but something in the $1k - $10k range seems plausible. One of the commenters at the Freakonomics site opines that the bid-ask spread in vote-buying is likely to be large. Evidently, this is borne out by our analysis.
For selling your vote in perpetuity in this scenario, risk comes to the fore. You may be fairly confident that the value of this election to you is small, but what about all future elections. What if Dr. Evil decides to run in 2024? In this case the risk premium you would have to assign is large enough that the practical answer is "not at any price".
My takeaway from all of this is the result that although the right to vote is precious to residents of a democracy, the act of voting itself is of little value to us. This result seems curious, but it makes a kind of sense. The right to vote ensures that in a broad sense candidates are aligned with the will of the voters in a way that they generally aren't in nondemocratic governments, so voting rights serve a useful purpose. Once that is established, however, the purpose of democracy has been served, and actually going to the polls to vote serves no further purpose.
What is a vote really worth? The poll questions seem to concentrate solely on the supply side (i.e., what would students sell their votes for, irrespective of whether there is anyone actually willing to pay that), which would suggest that we're trying to get at voters' personal valuation of their voting rights, all else being equal. So, let's assume that this opportunity is being offered to me only. The effect of my individual vote on the election's outcome is for all practical purposes nil, so from the standpoint of influencing the results of the election it is worth nothing. However, I do derive some personal satisfaction from voting that, on reflection, I'd value at a few tens of dollars; $50 would be a reasonable estimate. So, I should be willing to sell my vote for anything more than $50 (although I'd try to get the best price I could, of course). To sell my vote in perpetuity I'd want the discounted value of all of those future $50 votes. At first blush I might want some sort of risk premium, in case there might be some election in the future that I really want to influence, but since my probability of successfully influencing such an election is so small, that component is basically negligible. Depending on what discount rate you assume, that works out to about $2000 (assuming only one vote per year; if you include primaries and such it could come to several times that). Considering how many people voluntarily abstain from voting for no compensation at all, that seems like a reasonable number.
If we consider the possibility of the same deal being offered to everybody, then it gets a little harder to calculate a reasonable price. It's not too difficult to come up with our buying price for such a scenario. One or another candidate is bound to favor policies that will either cost us money directly or eliminate some benefit that we previously enjoyed. With a little work we could attach a value to those policy differences. To use myself as an example, my interaction with the government is primarily through taxes, but some policies might affect the costs of things I use. Let's say, for the sake of argument, that the present value of the benefit comes to $20k (although the fact that I would have a hard time telling you which side provides the benefit suggests that the number is actually much smaller than that). Suppose it takes about 5M votes to change the results of a large election. Then we're looking at about half a cent per vote. Clearly vote buying isn't a good strategy for little old me. For someone more entangled with government the total would be higher; someone standing to gain a billion dollars from having his candidate elected should be willing to pay $200 per vote in our example.
Clearly a rational selling price should be higher than the buying price, but how much? The total benefit from the preferred candidate winning provides an upper bound, since that price fully compensates the seller for having the unfavorable candidate win, but should he be willing to accept less? That depends on the probability that the seller and others like him will actually change the results of the election through the sale of their votes. For example, if you think there are 10:1 odds against your vote sale affecting the election, then you might be willing to accept $2000 for your vote. The exact odds calculation depends on who's buying and what their motivation is, but something in the $1k - $10k range seems plausible. One of the commenters at the Freakonomics site opines that the bid-ask spread in vote-buying is likely to be large. Evidently, this is borne out by our analysis.
For selling your vote in perpetuity in this scenario, risk comes to the fore. You may be fairly confident that the value of this election to you is small, but what about all future elections. What if Dr. Evil decides to run in 2024? In this case the risk premium you would have to assign is large enough that the practical answer is "not at any price".
My takeaway from all of this is the result that although the right to vote is precious to residents of a democracy, the act of voting itself is of little value to us. This result seems curious, but it makes a kind of sense. The right to vote ensures that in a broad sense candidates are aligned with the will of the voters in a way that they generally aren't in nondemocratic governments, so voting rights serve a useful purpose. Once that is established, however, the purpose of democracy has been served, and actually going to the polls to vote serves no further purpose.
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