One-dimensionality and stability in legislative voting

The widespread use in legislative studies of the one-dimensional model and its median-stability consequence raises a question: Do stability and one-dimensionality rest on evidence drawn from observed votes? They do not and cannot. I prove that every possible legislative history is compatible with a transitive majority preference (hence stability), and except in very special circumstances with a cyclic majority preference (hence instability) as well: observed votes can never refute and almost never confirm stability. One-dimensionality fares worse: any legislative history is compatible with the one-dimensional model if it includes no two votes with overlapping pairs of alternatives, but otherwise, I show, it is almost certainly incompatible with the model, even in those rare cases that ensure transitivity. Voting evidence aside, the one-dimensional model is unduly restrictive, and arguments in its defense do not survive scrutiny.     

Covering the private parts: the (re-)nationalisation of housing finance

Abstract

Is state power or control over financial markets really withering? Most narratives/analyses of financialisation see a growing penetration of private capital into everyday life that runs parallel to the increasing power of private financial capital over state policy. Yet housing finance – mortgages – sits at the centre of banking, and banking sits at the centre of the financial system. Large-scale mortgage markets only function where the state wraps around the banking system to remove maturity risks and to limit excessive credit creation. Partial deregulation in the 1990s and 2000s created a crisis that states resolved by re-nationalising much of mortgage finance. This renewed and overwhelming state presence suggests that financialisation is a state-driven story, and that private financial power, stability and instruments require state support above and beyond contract enforcement and prudential regulation.