New Economics Papers
on Collective Decision-Making
Issue of 2010‒03‒28
nine papers chosen by

  1. The Benefits of Costly Voting By Chakravarty, Surajeet; Kaplan, Todd R; Myles, Gareth
  2. On the informational efficiency of simple scoring rules By GOERTZ, Johanna M.; MANIQUET, Franois
  3. Fiscal federalism and electoral accountability By Toke S. Aidt; Jayasri Dutta
  4. European Monetary Policy and the ECB Rotation Model: Voting Power of the Core versus the Periphery By Ansgar Belke; Barbara von Schnurbein
  5. Costly information acquisition. Better to toss a coin? By Matteo Triossiv
  6. Reconciliation and Representation: The Share of the Population Represented by the Democratic Majority By Sarika Gupta
  7. Voting on pensions : sex and marriage By LEROUX, Marie-Louise; PESTIEAU, Pierre; RACIONERO, Maria
  8. A New Concept of European Federalism. By Bruno S. Frey
  9. Introduction to Judgment Aggregation By Christian List; Ben Polak

  1. By: Chakravarty, Surajeet; Kaplan, Todd R; Myles, Gareth
    Abstract: We present a costly voting model in which each voter has a private valuation for their preferred outcome of a vote. When there is a zero cost to voting, all voters vote and hence all values are counted equally regardless of how high they may be. By having a cost to voting, only those with high enough values would choose to incur this cost. Hence, the outcome will be determined by voters with higher valuations. We show that in such a case welfare may be enhanced. Such an effect occurs when there is both a large enough density of voters with low values and a high enough expected value.
    Keywords: costly voting; externalities.
    JEL: C70 D72
    Date: 2010–03–13
  2. By: GOERTZ, Johanna M.; MANIQUET, Franois (UniversitŽ catholique de Louvain (UCL). Center for Operations Research and Econometrics (CORE))
    Keywords: efficient information aggregation, scoring rules, Poisson games, approval voting
    JEL: C72 D72 D81 D82
    Date: 2009–04–01
  3. By: Toke S. Aidt (University of Cambridge); Jayasri Dutta (University of Birmingham)
    Abstract: We study the efficient allocation of spending and taxation authority in a federation in which federal politicians are exposed to electoral uncertainty. We show that centralization may, but need not, result in a loss of electoral accountability. We identify an important asymmetry between positive and negative externalities and show that centralization may not be efficient in economies with positive externalities even when regions are identical and centralization does not entail a loss of accountability. We also show that decentralization can only Pareto dominate centralization in economies with negative externalities.
    Keywords: Fiscal federalism, local public goods, externalities, performance voting,turnout uncertainty, electoral accountability
    JEL: D72 D78 H41
    Date: 2010
  4. By: Ansgar Belke; Barbara von Schnurbein
    Abstract: We analyze the ECB Governing Council's voting procedures. The literature has by now discussed numerous aspects of the rotation model but does not account for many institutional aspects of the voting procedure of the GC. Using the randomization scheme based on the multilinear extension (MLE) of games, we try to close three of these gaps. First, we integrate specific preferences of national central bank presidents, i.e. their desired interest rates. Second, we address the agenda-setting power of the ECB president. Third, we do not simulate an average of the decisions but look at every relevant point in time separately.
    Keywords: Euro area, European Central Bank, monetary policy, rotation, voting rights
    JEL: D72 D78 E58
    Date: 2010
  5. By: Matteo Triossiv
    Abstract: Citizens have little and uneven levels of political knowledge, consistently with the rational ignorance hypothesis. The paper presents a strategic model of common value elections with endogenous information acquisition accounting for these facts. It proves, that contrary to the most optimistic positions about direct democracy, majoritarian elections can fail to aggregate information, when voters have heterogeneous skills. Informational inefficiencies can be partially corrected by improving the skills of the electorate as the population increase or by limiting participation to most competent citizens. The first interpretation is consistent with Rousseau view that an educated citizenry is necessary for a well functioning democracy. The second interpretation provides rational foundations for an epistocratic form of government. JEL Classification Numbers: C72, D72, D82. Keywords: Costly Information Acquisition, Condorcet Jury Theorem.
    Date: 2010
  6. By: Sarika Gupta
    Abstract: With the debate over health care dragging on, it is becoming increasingly likely that the Senate will pass a bill through the reconciliation process, requiring just a simple majority rather than the super-majority needed to break a filibuster. This paper shows that if this path is taken, senators who represent the vast majority of the nation’s population will have supported the bill. This assessment holds even if several of the senators who have indicated serious reservations end up voting against it.
    Keywords: health care, reform
    JEL: I I1 I18
    Date: 2010–03
  7. By: LEROUX, Marie-Louise (UniversitŽ catholique de Louvain (UCL). Center for Operations Research and Econometrics (CORE)); PESTIEAU, Pierre (University of Liege, CREPP, CORE, PSE and CEPR); RACIONERO, Maria (School of Economics, Australian National University)
    Abstract: Existing political economy models of pensions focus on age and productivity. In this paper we incorporate two additional individual characteristics: sex and marital status. We ignore the role of age, by assuming that people vote at the start of their life, and characterize the preferred rate of taxation that finances a Beveridgean pension scheme when individuals differ in wage, sex and marital status. We allow for two types of couples: one-breadwinner and two-breadwinner couples. Marriage pools both wage and longevity differences between men and women. Hence singles tend to have more extreme preferred tax rates than couples. We show that the majority voting outcome depends on the relative number of one-breadwinner couples and on the size of derived pension rights.
    Keywords: social security, differential longevity, majority voting, individualization of pension rights
    JEL: D72 D78 H55
    Date: 2009–09–01
  8. By: Bruno S. Frey
    Abstract: By opening markets the European union has been also an economic success. However, with respect to political organization the European Union is far less accomplished. The misguided concept of a successful Europe consists in mistaking integration for harmonization and homogenization. But the essence of Europe is its diversity. No steps have been taken to actively institutionalize competition between governmental units at all levels. The welfare of European citizens could be improved by promoting competition between new jurisdictions. A new type of federalism based on Functional, Overlapping Competing Jurisdictions FOCJ is here proposed. FOCJ form a federal system of governments emerging from below as a response to citizens' preferences. The lowest political units (communes) must be given the freedom to engage in forming FOCJ and must have the right to levy taxes to finance the public services they provide.
    Keywords: federalism, constitutional economics, public choice, monopoly on territory
    JEL: H11 H4 H5
    Date: 2010–01
  9. By: Christian List; Ben Polak
    Date: 2010–03–17

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