[395] AN ECONOMIC THEORY OF REFERENDUM VOTING: SCHOOL CONSTRUCTION AND

Local public project referenda provide the voter a unique opportunity to shape public activity. Prior studies of these votes fail to develop a behavioral model of this choice, usually relying on ad hoc explanations of variables that, for one reason or another, contribute to forecasts of referendum results. Our paper outlines a stock adjustment model of school bond referenda and tests this model using data from a set of school elections in West Virginia. The unique features of our model are treatment of the bond voting decision as an input decision and, hence, as involving derived demand; analysis of the bond referendum as a stock adjustment decision; and concentration on voting as a decision between discrete, mutually exclusive options. Local public project referenda present the voter with a ~~ ~ unique opportunity to shape public activity and the taxes he pays. In an important sense, these votes give the typical citizen his only direct influence on public decisions. Voter influence on school construction has been major in the past few years. Of the 1,216 school bond elections in the United States during fiscal 1970, only 53.2 % succeeded, the lowest succes