New Economics Papers
on Collective Decision-Making
Issue of 2006‒02‒12
five papers chosen by

  2. Welfarism, Preferencism, Judgmentism By Dietrich Franz
  3. Ideology and existence of 50%-majority equilibria in multidimensional spatial voting models By Crès, Hervé; Ünver, Utku
  4. Fairness vs. Social Welfare in Experimental Decisions By Stefan Kohler
  5. Do the rich vote Conservative because they are rich? By Lind, Jo Thori

  1. By: Daniel Castellanos
    Abstract: In this article, we do two things: first, we present an alternative and simplified proof of the known fact that cardinal individual utility functions are necessary, but not sufficient, and that interpersonal comparability is sufficient, but not necessary, for the construction of a social welfare function. This means that Arrow’s impossibility theorem is simply a consequence of forcing the individual utility functions to be ordinal. And second, based on this proof, this article establishes two necessary conditions for the adequate definition of a social choice problem. It is shown that, if these two conditions are satisfied, a number of desirable properties for a social choice are satisfied, including transitivity. This means that Condorcet’s paradox is simply the result of a social choice problem that is not well defined.
    Date: 2005–11–10
  2. By: Dietrich Franz (METEOR)
    Abstract: In a single framework, I address the question of the informational basis for evaluating social states. I particularly focus on information about individual welfare, individual preferences and individual (moral) judgments, but the model is also open to any other informational input deemed relevant, e.g. sources of welfare and motivations behind preferences. In addition to proving some possibility and impossibility results, I discuss objections against using information about only one aspect (e.g. using only preference information). These objections suggest a multi-aspect informational basis for aggregation. However, the multi-aspect approach faces an impossibility result created by a lack of inter-aspect comparability. The impossibility could be overcome by measuring information on non-cardinal scales.
    Keywords: public economics ;
    Date: 2006
  3. By: Crès, Hervé; Ünver, Utku
    Abstract: When aggregating individual preferences through the majority rule in an n-dimensional spatial voting model, the "worst-case" scenario is a social choice configuration where no political equilibrium exists unless a super majority rate as high as 1-1/n is adopted. In this paper the authors assume that a lower d-dimensional (d<n)linear map spans the possible candidates plateforms. These d "ideological" dimensions imply some linkages between the n political issues. The authors randomize over these linkages and show that there almost surely exists a50%-majority equilibria in the above worst-case scenario, when n grows to infinity.Moreover the equilibrium is the mean voter. The speed of convergence (toward 50%)of the super majority rate guaranteeing existence of equilibrium is computed for d= 1 and 2.
    Keywords: spatial voting; super majority; ideology; mean voter theorem; random point set
    JEL: C62 D72
    Date: 2006–02–06
  4. By: Stefan Kohler
    Abstract: Experimental evidence from modified dictator games and simple choice situations indicates that concern for overall welfare is an important motive in human decision making. Models of inequality averse agents, as suggested by Fehr and Schmidt (1999) or Bolton and Ockenfels (2000), fall short in explaining behavior of proposers, who reduce their payoff below a fair split of the endowment to maximize social welfare, while other types of social preferences do well on these data. This has created the impression that inequality aversion is a misguided concept. This paper presents a formal model and shows that a combination of welfare concern and inequality aversion changes this result in favor of inequality aversion. It also establishes a unique link between altruism and social welfare in the proposed model.
    Keywords: Social Preferences, Inequality Aversion, Welfare Concern, Reciprocity
    JEL: A13 B49 C70 D63 D64
    Date: 2005
  5. By: Lind, Jo Thori (Dept. of Economics, University of Oslo)
    Abstract: Political economy models predict that the rich oppose redistribution, and hence vote for conservative parties. Although this seems to fit the data well, I show that this is not true when we control for unobservable characteristics. Using Norwegian survey data, I study to what extent voting is caused by income. Unobserved characteristics correlated with income are handled by using fixed effects panel data discrete choice models. Although a positive association between income and conservative voting persists when controlling for unobservables, the magnitude of the effect is reduced by a factor of five. To correct for measurement error, I instrument income with average income by profession. The magnitude of the coefficients is increased, but the main conclusions remain.
    Keywords: Political economy; redistribution; voting; multinomial logit; panel data
    JEL: C23 C25 D31 D72 H11 H53
    Date: 2006–02–03

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