The blog, Mike Norman Economics points to a recent paper from Cornell which can be downloaded from this link. It is a study of democratic internet sites called Wikis where people can collaboratively and democratically contribute and improve content. It finds that as the number of contributors grows past some arbitrarily large number, a "oligopoly" (a hierarchy of power roles) is instituted. From this, conclusions are drawn (rightly or wrongly) about the limits of the size of democratic organizations.