Abstract

The choice of a social decision rule for a federal assembly affects the welfare distribution within the federation. But which decision rules can be recommended on welfarist grounds? In this paper, we focus on two welfarist desiderata, viz. (i) maximizing the expected utility of the whole federation and (ii) equalizing the expected utilities of people from different states in the federation. We consider the European Union as an example, set up a probabilistic model of decision making and explore how different decision rules fare with regard to the desiderata. We start with a default model, where the interests, and therefore the votes of the different states are not correlated. This default model is then abandoned in favor of models with correlations. We perform computer simulations and find that decision rules with a low acceptance threshold do generally better in terms of desideratum (i), whereas the rules presented in the Accession Treaty and in the (still unratified) Constitution of the European Union tend to do better in terms of desideratum (ii). The ranking obtained regarding desideratum (i) is fairly stable across different correlation patterns.