Voting in the Goods and Services Tax Council of India

Bhattacherjee, Sanjay and Sarkar, Palash (2018): Voting in the Goods and Services Tax Council of India.

Abstract

The Goods and Services Tax (GST) law (2017) of India, created a GST Council with representatives of the Union government and the Provincial governments. The decision making procedure in this Council is specified to be by weighted voting. We perform a detailed study of such a mechanism using the framework of formal voting games. On a theoretical note, several new notions regarding blocking dynamics of voting games are introduced. These are then applied to the voting mechanism in the GST Council. We identify a set of basic desiderata and propose some modifications to the voting rule in the GST Act.

• Item Type: MPRA Paper
• Language: English
• Keywords: Goods and Services Tax (GST); GST Council; Weighted majority voting games; Winning and blocking coalition; Blocking power; Efficiency; Influence
• Subjects: C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C71 - Cooperative Games; D - Microeconomics > D7 - Analysis of Collective Decision-Making; D - Microeconomics > D7 - Analysis of Collective Decision-Making > D72 - Political Processes: Rent-Seeking, Lobbying, Elections, Legislatures, and Voting Behavior; D - Microeconomics > D7 - Analysis of Collective Decision-Making > D73 - Bureaucracy ; Administrative Processes in Public Organizations ; Corruption; G - Financial Economics > G2 - Financial Institutions and Services > G28 - Government Policy and Regulation; H - Public Economics > H1 - Structure and Scope of Government; H - Public Economics > H2 - Taxation, Subsidies, and Revenue; H - Public Economics > H7 - State and Local Government ; Intergovernmental Relations > H71 - State and Local Taxation, Subsidies, and Revenue; H - Public Economics > H7 - State and Local Government ; Intergovernmental Relations > H77 - Intergovernmental Relations ; Federalism ; Secession; Y - Miscellaneous Categories > Y1 - Data: Tables and Charts > Y10 - Data: Tables and Charts; Z - Other Special Topics > Z1 - Cultural Economics ; Economic Sociology ; Economic Anthropology > Z18 - Public Policy

References

Banzhaf, J. F. (1965). Weighted voting doesn’t work: A mathematical analysis. Rutgers Law Review, 19:317–343.

Bhattacherjee, S. and Sarkar, P. (2017). Cryptocurrency voting games. https://ideas.repec.org/p/pra/mprapa/83592.html.

Chakravarty, S. R., Mitra, M., and Sarkar, P. (2015). A Course on Cooperative Game Theory. Cambridge University Press.

Coleman, J. S. (1971). Control of collectives and the power of a collectivity to act. In Lieberma, B., editor, Social Choice, pages 269–298. Gordon and Breach, New York.

Felsenthal, D. S. and Machover, M. (1998). The Measurement of Voting Power. Edward Elgar, Cheltenham.

Laruelle, A. and Valenciano, F. (2011). Voting and collective decision-making. Cambridge University Press, Cambridge.

Leech, D. (2002a). Designing the voting system for the council of the european union. Public Choice, 113:437–464.

Leech, D. (2002b). Power in the governance of the international monetary fund. Annals of Operations Research, 109(1-4):375––397.

Matsui, T. and Matsui, Y. (2000). A survey of algorithms for calculating power indices of weighted voting games. Journal of Operations Research Society of Japan, 43:71–86.

Penrose, L. S. (1946). The elementary statistics of majority voting. Journal of the Royal Statistical Society, 109:53–57.

Shapley, L. S. (1953). A value for n-person games. In Kuhn, H. W. and Tucker, A. W., editors, Contributions to the Theory of Games II (Annals of Mathematics Studies), pages 307–317. Princeton University Press.

Shapley, L. S. and Shubik, M. J. (1954). A method for evaluating the distribution of power in a committee system. American Political Science Review, 48:787–792.