That doesn't keep people from de-facto running as party representatives, though. They can't put their party affiliation on the ballot, but they can say in their speeches which of the national parties they prefer, and parties can issue press releases explaining which of the candidates they support. So it tends towards a two-party, first-past-the-post situation.
If you have a proportional system, where you can more truly state your preferences yet have your vote count even if your first preference doesn't succeed, you end up with more diversity. Downsides include greater tendency for coalition governments and potentially less clear mandates for decisive governments.
This is a self fulfilling prophecy.
People should vote for third parties more often! The mainstream ones suck!
No way, and "waste" my vote? I'd rather hold my nose and pick someone who has a chance!
(6 months later, when the guy voted in is officially hated)
Man, people should vote for third parties more often, this guy is horrible..
And it's this conversation and line of thinking that ensures that (in the USA), it's the same old crap, day in and day out.
There's a saying about doing the same thing over and over again and expecting different results..