Ethan Leib and Chris Elmendorf have posted this draft on SSRN (forthcoming California Law Review). Here is the abstract:

Too often popular political power – whether it is in the form of direct democracy or other more innovative forays in participatory or deliberative democracy – presents itself as a counterweight to the political power parties wield. Yet setting up “popular democracy” and “party democracy” in opposition to one another in the American political landscape is not only unnecessary but also pathological: it thwarts an understanding of their potential for mutual enrichment. Popular democracy and party-based representative democracy in the American states each have characteristic limitations. Mass popular democracy – the ballot initiative and the referendum – presents a daunting informational challenge for ordinary voters. Popular democracy in its more selective, deliberative forms gives rise to unanswered questions about agenda-setting and legitimation. Meanwhile, party democracy as practiced in the American states often fails to realize the virtues claimed for it, because structural features of state government occlude party-based accountability, and because parties may not develop coherent, competitive state-level brands. We argue that institutional designers can use parties to solve some of the characteristic problems of popular democracy, and popular democracy to improve the functioning of party democracy. We illustrate our claims with a discussion of two seemingly disparate problems: state budget stalemates, and the design of state constitutional conventions.

I read an earlier draft of this very interesting paper.  Recommended!