Supermajority Rule in Bicameral Legislatures

This paper revisits the claim that supermajority rules and bicameral structure restrain excessive government spending and taxation. Our analysis suggests that supermajority rule has a coun-tervailing effect in bicameral legislatures due to two factors: the geographic linkages across two chambers and the low price elasticity of demand for public goods. Using a panel of 49 American states over a period of 39 years (1970-2008), we find that Senate district fragmentation—the ratio of seats in the House relative to seats in the Senate—has a robust, positive impact on the tendency of a supermajority rule to inflate the budget. Our finding implies that a supermajority rule in bicameral legislatures can have a perverse effect on budget outcomes.