When interests are not proportional.
Imagine a corporation where you have 80% stake. And another 20 people have 20% stake.
One man one vote.
No body would care how the corporation will make profit. The 20 people will simply vote that the corporation gives all the money to all people.
In Jakarta there is a mosque that like to sound adzan. Adzan is a sensitive issue in Indonesia with one girl sent to jail for complaining against it.
The way things work in Indonesia is that the majority of the population is muslim. However, the non muslims, particularly the chinese, are way richer. How rich? I don't know.
And the result is a never ending discrimination against chinese. It gets less and less though recently it went up again.
Another story that I know is about a mosque in the middle of a real estate project.
The owner of real estate project definitely wants the mosque to be demolished. After all that one mosque is "noisy". The property developer wants his house to sell and the mosque is not advantageous for him.
I think in cases like this, owners of land should have "bigger" vote than any normal people. Not necessarily an issue in this case because the muslim is also minority there.
However, there are cases where many poor people illegally squat on government land have the same voting power with those actually owning the land.
When voting power does not depend on contribution
In US, democracy gives disproportionate power to those who simply have more children. We have generations and generations of cradle to grave welfare parasites.
Most people in democracy do not like accepting refugee or even cheap workers because of this. That's because those refugee will become citizen with equal voting power. This lead to inefficiency. Why should rich American wash their own dishes if they can pay cheaper mexican to do so? But if you accept them, they can vote more money out of your paycheck through income tax.
And that leads to an important point. Why should someone have power to run your life simply because he's born at the right place or come to your country? If anything, it doesn't serve your interests at all.
However, democracy weighted by interests and contribution works just fine. In corporation we have one share one vote. So it works pretty fine.
When some voting blocs can vote to steal from another voting blocs
Giving dividend to shareholders is also another reason why corporate democracy works better than normal democracy.
In normal democracy, some voting blocs would vote against the interest of other voting blocs. The result is often legalized stealing. The effect of voting blocs voting against one another's interest results in a very unnecessarily complex social program.
We got job creation for those who gets job, we got unemployment benefits for those who don't. And we got affirmative action for those who are less likely to get a job.
Combined those tend to benefit citizens in equal share for everyone anyway. So why not just pay dividend and get done with it.
There's a parody of this issue here http://www.usmessageboard.com/posts/21128617/
In corporate democracy, voting blocs cannot vote to steal from another voting blocs. Every share got the same dividend. Hence, in corporate democracy people vote on how to make the "pie" bigger rather than how to get more pie.
Corporate decisions are often more swift. Normal democracy is so bloated.
When catering to the need of all kind of people is inefficient/where it's far more efficient to make certain niches happy than all people happy
Now for minority rights. Market mechanism protect minority right far better than democracies. Minority shareholders can just sell shares at market price. Minority customers can simply buy from different company.
This gives "legitimacy" to decisions made by the majority shareholder.
The market solution for minority right is efficient. If you don't like what we're doing just get out. We don't expect microsoft to produce noodle. Each corporations try to make "some people" happy. The rest are none of their concern. If someone is unhappy, as long as their right is not violated, then no problem. Who cares. Those who like pizza can go to pizza hut instead of microsoft.
In democracies, 2 things happen, and both are bad. One thing that happens is the majority oppress the minorities. We see extermination of jews, armenian. We see discrimination and pogroms against chinese.
Usually, the one screwed by the mob are the best and brightest. The race or ethnic that's slaughtered are often the most industrious ones.
Another thing a democracy can do is to have laws protecting minorities right. This often leads to the majority bending over backward for the minority. That is also not efficient.
Normal democracies protect minority right with a band aid. And the result is even worse. Now small member of society can pretty much halt normal decision making for the whole group. Normal democracy becomes very "bloated" because of this.
I've heard in US, a muslim can sue a supermarket so he is replaced in a job where he doesn't have to help people buying pork. The japanese address this issue by simply making it very difficult for muslims to come to Japan. That actually hurts muslims.
French ban burqa and gets a lot of protest. It seems that muslim countries solve this issue easily. Don't listen to protest. So what if their country is a muslim country? As a non muslim, I simply don't go there.
I've also heard that muslim terrorists slaughter people in Charlie Hebdo. I've heard that such acts are supported by many muslim voters. In western countries, you can make fun of Jesus, Buddha, and Khrisna. But you risk getting shot by terrorists if you make fun of Muhammad.
So to protect some minorities "right" from being offended, the majority in western civilization is bending over backward toward their small number of radical muslim overlords. Very inefficient.
Instead, the french could declare that the nation caters to those who love freedom of speech niche. Those who don't like it can just get out.
Why not have a sensible solution. Sure they can come but they obey the will of the original citizens or majority? Well... Kind of tricky in normal democracy because once a person immigrate he can vote too.
I think it's simply more efficient for people that don't fit on society to simply get out.
Look at the secular in Indonesia. If they really want secular countries, shouldn't they get out?
Or look at the muslim in france. If they don't like burqha ban, why not just get out?
It's simply far more efficient for each countries to cater to their "niches" then trying to be fair and equal for all kind of people. We have islamic countries. We have secular countries. Why can't each people go where they like.
Under normal democracy this doesn't seem to work out really well. We are all minorities in some issues. There's always a question why should A that gets out and why not B. Also many feel that minorities also own part of a country and hence should be compensated if they get out.
In corporate democracy this is not a problem. Again, any minority shareholder can get out and be compensated for his share. Any visitors/people/customers to disneyland that do not like disneyland can simply write a bad review and go somewhere else.
In normal democracies, most benefits toward citizens only happens when the citizen lives in the same country. Welfare, jobs creation, would benefit citizens of french only if they live in french. So minorities that actually don't fit french culture, and don't like freedom of speech, and don't even speak french, choose to come and stay and breed in french.
Making them go then have much higher political costs and require much bigger determination even though it's the efficient thing to do.
If citizens are replaced by shareholders, those who do not like the way the french is doing things can sell citizenship to those who like freedom of speech. So those who don't fit will be compensated for "leaving" making things easier for everybody.
When commitment to freedom of speech is low
Democracies require people to be reasonably well informed. Well, some people think that certain ideas are sacrosanct it's beyond critic. So it's easy to package corruption with religious values. Anyone criticizing it go to jail.
A sample case of this is Ahok's case. Indonesia is a very corrupt countries. Ahok cleans up corruption. Then what? People uses religion to tell Indonesians that they cannot vote for Ahok because he's non muslims. Their true motives is to steal money from government. Obviously they don't honestly tell their true motives are.
Ahok, jokingly says that people are being lied to by using religion. Ahok was sentenced to jail for 2 years. He's still a very popular politicians that got 44% of the vote in the election. All because he said something that most westerners accept as facts, that religions are often used for lying.
Notice Ahok is already very polite. He didn't say that quran is a lie or that the ulama is lying. He said that someone is using it for lying. But restrictions of freedom of speech is very rubbery on this obviously politically charged accusation.
My guess is Ahok's case is typical. This explains why corruption is higher in muslim countries. This also explains why most muslim countries are not democracy. This also explains why most christian countries are also not democracies before they're secular.
Religion is like a wrench in a machine in democracy.
When objectives are unclear and hard to measure
Corporations have clear measurable objectives, namely maximization of investors' return.
Because citizenship doesn't have valuation, cannot be bought or sold, and does not pay dividend, people do not know for sure whether their leaders are doing a good job or not.
Sure corruption is legal. But what about using government budget to subsidize gasoline? OR giving money to some sport clubs? Or mobs? Or to build church? Or mosques? It's not clear whether that's corruption or not. It's obviously rent seeking.
Again, we don't have problems with this in corporations.
A democratic state should consider converting all their citizenship into shares. Allow those who don't fit the state's value to sell their citizenship/shares to those willing to pay, and then can convert back to normal democracy again.
This is a post that advocates changing normal democracies to be more like democracies practice in corporation