Participatory budgeting in Amsterdam

I live in the West district in Amsterdam, where the local council has given residents power to allocate €300,000 to projects proposed by anyone.

I welcome this participatory process, but it has some flaws, which I’ll discuss here, along with my recommendations for improvement.

First, let’s clarify that this process is heavily managed. The amount to allocate is a tiny fraction of the total budget for the district, and experts make sure that proposals from the community are “feasible.” 

Even still, the voting process is flawed. Last year, I was surprised to see that I was asked to allocate the total budget of €300,000 among proposed projects. This process gave far too much weight to big projects, since projects were selected based on the number of votes they got from residents.

For example:
1st place: €50.000 project chosen via 12,839 votes = €4.03/vote
2e place: €5.000 project via 12,367 votes = €0.40/vote

As you can see, the way to win is to have a big budget, which will crowd out other projects (by absorbing the vote budget) as well as benefitting from voter fatigue, since it’s easier to choose one €50k project than choose ten €5k projects. (I’m pretty sure city bureaucrats also prefer to administer one big project over ten smaller projects, since per project set up costs are probably similar.)

Luckily, there’s an easy solution: give voters a “personal budget” of, say, €300, and then let them put 0-100 percent of that onto as many projects as they can afford. 

Thus, I can vote €150 to project 1 (€50.000, meaning its now 0.30% closer to happenings) and €150 to project 2 (a €5.000 project that’s now 3.0% to funded).

My one-handed conclusion is that voters will get better value for their taxes if they vote a personal budget. 

Addendum (19 Oct): The local bureaucrats in charge of this initiative clarified that this process will allocate 21% of the budget (good!) but they like their current method (sad!).

Author: David Zetland

I'm a political-economist from California who now lives in Amsterdam.

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