Referendum is an electoral system in which voters make a decision on a specific issue rather than on a political party or candidate. Referendum elections can be used to amend a constitution or laws, propose new legislation and statutes or even abolish a law. Referendums can be mandated by a country’s constitution or other laws or can be initiated by citizens or government agencies. Generally, referendums are non-binding.

Supporters of referendums argue that they help to re-engage citizens with politics and democracy. They also help to decentralise power from elected representatives to the people and allow them to vote directly on issues of particular importance. In addition, they can be a way of resolving political disputes without splitting a governing party (e.g., the UK referendum on NATO membership in 1986).

Critics argue that referendums are problematic for several reasons. First, they often raise issues that are not fully debated in the broader public and may be complicated to understand. Furthermore, they can introduce a degree of risk to citizens because of the lack of knowledge about the consequences of the outcome. Finally, the use of referendums to settle constitutional questions seems to overstate voter competence to evaluate such minutiae and is unlikely to yield good outcomes (Cheneval and el-Wakil 2018).

Despite these concerns, referendums are still widely used, particularly in countries that do not have parliamentary systems. We study how citizens cope with complex ballot provisions and the impact of a variety of campaign tactics on their choices. In our experiments, we find that even substantial effort to improve the wording of such ballots and educate voters makes little difference to their comprehension. Our results also suggest that, on complex issues, risk aversion and a lack of information motivate many voters to opt for a NO choice, resulting in unreliable decisions that can have profound policy implications.