nep-cdm New Economics Papers
on Collective Decision-Making
Issue of 2006‒02‒05
five papers chosen by
Marco Novarese
Universita del Piemonte Orientale

  1. The Median Voter and the Median Consumer: Local Private Goods and Residential Sorting By Joel Waldfogel
  2. Knowledge Sharing in Public Sector Organizations: The Effect of Organizational Characteristics on Interdepartmental Knowledge Sharing. By A. WILLEM; M. BUELENS
  3. Social Choice: Recent Developments By Walter Bossert; John A. Weymark
  5. Controlling firms through the Majority Voting Rule. By Ariane Chapelle; Ariane Szafarz

  1. By: Joel Waldfogel
    Abstract: When a product's product provision entails fixed costs, it will be made available only if a sufficient number of people want it. Some products are produced and consumed locally, so that provision requires not only a large group favoring the product but a large number nearby. Just as one has an incentive to sort into community whose median voter shares his preferences for local public goods, product markets may provide an analogous incentive to sort into a community whose consumers tend to share his preferences in private goods. Using zip code level data on chain restaurants and restaurants overall, this paper documents how the mix of locally available restaurants responds to the local mix of consumers, with three findings. First, based on survey data on chain restaurant patronage, restaurant preferences differ substantially by race and education. Second, there is a strong relationship between restaurants and population at the zip code level, suggesting that restaurants’ geographic markets are small. Finally, the mix of locally available chain restaurants is sensitive to the zipcode demographic mix by race and by education. Hence, differentiated product markets provide a benefit -- proximity to preferred restaurants -- to persons in geographic markets whose customers tend to share their preferences.
    JEL: L1 L8 R3
    Date: 2006–01
    Abstract: Public sector organizations are mainly knowledge-intensive organizations and to exploit their knowledge, effective knowledge sharing among the different departments is required. We focus on specific characteristics of public sector organizations that increase or limit interdepartmental knowledge sharing. Three types of organization-specific coordination mechanisms directly influence knowledge sharing between units. Organizations are also characterized by members’ social identification and trust, which in the absence of power games are assumed to create a knowledge sharing context. Data are presented from a questionnaire survey in the public sector. The sample consists of 359 cooperations between departments in more than 90 different public sector organizations. Structural equation modelling reveals the importance of lateral coordination and trust. The combination of power games and informal networking seems to be remarkably beneficial for knowledge sharing. Furthermore, compared with other public sector organizations, government institutions have organizational characteristics that are less beneficial for knowledge sharing.
    Keywords: coordination mechanisms, knowledge sharing, organization structure, public sector organizations
    Date: 2005–11
  3. By: Walter Bossert (Department of Economics, Mount Allison University); John A. Weymark (Department of Economics, Vanderbilt University)
    Abstract: In the past quarter century, there has been a dramatic shift of focus in social choice theory, with structured sets of alternatives and restricted domains of the sort encountered in economic problems coming to the fore. This article provides an overview of some of the recent contributions to four topics in normative social choice theory in which economic modelling has played a prominent role: Arrovian social choice theory on economic domains, variable-population social choice, strategy-proof social choice, and axiomatic models of resource allocation.
    Keywords: Social choice, Arrow's Theorem, Gibbard-Satterthwaite Theorem, strategy-proofness, fairness, axiomatic models of resource allocation
    JEL: D63
    Date: 2006–01
  4. By: Federico Valenciano (Universidad del País Vasco); Annick Laruelle (Universidad de Alicante)
    Abstract: Committees are often made up of representatives of different-sized groups of individuals, and make decisions by means of a voting rule which specifies what vote configurations can pass a decision. This raises the question of the choice of the optimal voting rule, given the different sizes of the groups that members represent. In this paper we take a new departure to address this problem, assuming that the committee is a bargaining scenario in which negotiations take place 'in the shadow of the voting rule' in search of unanimous consensus. That is, a general agreement is looked for, but any winning coalition can enforce an agreement.
    Keywords: Voting rule, Bargaining, Nash solution.
    Date: 2005–09
  5. By: Ariane Chapelle (Centre Emile Bernheim, Solvay Business School, Université Libre de Bruxelles, Brussels); Ariane Szafarz (Centre Emile Bernheim, Solvay Business School, Université Libre de Bruxelles, Brussels and DULBEA, Université Libre de Bruxelles)
    Abstract: Pyramids, cross-ownership, rings and other complex features inducing control tunnelling are frequent in the European and Asian industrial world. Based on the matrix methodology, this paper offers a model for measuring integrated ownership and threshold-based control, applicable to any group of interrelated firms. In line with the theory on pyramidal control, the model avoids the double counting problem and sets the full-control threshold at the conservative - but incontestable - majority level of 50% of the voting shares. Any lower threshold leads to potential inconsistencies and leaves unexplained the observed high level of ownership of many dominant shareholders. Furthermore, the models leads to ultimate shareholders' control ratios consistent with the majority voting rule. Finally, it is applied to the Frère Group, a large European pyramidal holding company known for mastering control leverages.
    Keywords: Majority Voting Rule, Pyramidal Ownership; Corporate Control; Corporate Governance
    JEL: G32
    Date: 2005–02

This nep-cdm issue is ©2006 by Marco Novarese. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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