New Economics Papers
on Collective Decision-Making
Issue of 2010‒05‒15
eight papers chosen by

  1. Identification of Voters with Interest Groups improves the Electoral Chances of the Challenger By Vjollca Sadiraj; Jan Tuinstra; Frans van Winden
  2. Sincere Scoring Rules By Nunez Matias
  3. The discursive dilemma in monetary policy By Carl Andreas Claussen; Øistein Røisland
  4. Political economics of higher education finance By Jordi Jofre-Monseny; Martin Wimbersky
  5. Decentralization and Nationalization of Party Systems By Ignacio Lago-Peñas; Santiago Lago-Peñas
  6. Fiscal and Political Decentralization and Government Quality By Andreas P. Kyriacoua; Oriol Roca-Sagalésb
  7. Stone Age Equilibrium By Harold Houba; Hans-Peter Weikard
  8. Comparable Axiomatizations of the Myerson Value, the Restricted Banzhaf Value, Hierarchical Outcomes and the Average Tree Solution for Cycle-Free Graph Restricted Games By René van den Brink

  1. By: Vjollca Sadiraj (Georgia State University); Jan Tuinstra (University of Amsterdam); Frans van Winden (University of Amsterdam)
    Abstract: Interest groups are introduced in a spatial model of electoral competition between two political parties. We show that, by coordinating voting behavior,these interest groups increase the winning set, which is defined as the set of policy platforms for the challenger that will defeat the incumbent. Therefore interest groups enhance the probability of the challenger winning the election.
    Keywords: Spatial voting models; electoral competition; winning set; interest groups
    JEL: D71 D72
    Date: 2009–11–11
  2. By: Nunez Matias (THEMA, Universite de Cergy-Pontoise)
    Abstract: Approval Voting is shown to be the unique scoring rule that leads strategic voters to sincere behavior of three candidates elections in Poisson Games. However, Approval Voting can lead to insincere behavior in elections with more than three candidates.
    Keywords: Sincerity, Approval Voting, Scoring rules, Poisson Games
    JEL: D72
    Date: 2010
  3. By: Carl Andreas Claussen (Sveriges Riksbank); Øistein Røisland (Norges Bank (Central Bank of Norway))
    Abstract: The discursive dilemma implies that the policy decision of a board of policymakers depends on whether the board reaches the decision by voting directly on policy (conclusion-based procedure), or by voting on the premises for the decision (premise-based procedure). We derive results showing when the discursive dilemma may occur, both in a general model and in a standard monetary policy model. When the board aggregates by majority voting, a discursive dilemma can occur if either (i) the relationship between the premise and the decision is non-monotonic, or (ii) if the board members have different judgments on at least two of the premises. Normatively, a premise-based procedure tends to give better decisions when there is disagreement on parameters of the model.
    Date: 2010–04–20
  4. By: Jordi Jofre-Monseny (University of Passau); Martin Wimbersky (University of Munich)
    Abstract: We study voting over higher education finance in an economy with risk averse households who are heterogeneous in income. We compare four different systems and analyse voters' choices among them: a traditional subsidy scheme, a pure loan scheme, income contingent loans and graduate taxes. Using numerical simulations, we find that majorities for income contingent loans or graduate taxes become more likely as the income distribution gets more equal. We also perform sensitivity analyses with respect to risk aversion and the elasticity of substitution between high skilled and low skilled workers.
    Keywords: Voting, higher education, financing scheme
    JEL: H52 H42 D72
    Date: 2010
  5. By: Ignacio Lago-Peñas (Universitat Pompeu Fabra, Department of Social and Political Sciences); Santiago Lago-Peñas (REDE, IEB, and University of Vigo)
    Abstract: Based on a sample of 227 elections in seventeen Western European countries over the period of 1945-1998, this paper examines to what extent party systems are shaped by fiscal and political decentralization. With the exception of a few special cases, empirical evidence does not support the existence of a robust relationship between the degree of decentralization and the nationalization of party systems.
    Keywords: Decentralization, federalism, nationalization, party systems.
    Date: 2010–02–01
  6. By: Andreas P. Kyriacoua (Departament d’Economia, Universitat de Girona); Oriol Roca-Sagalésb (Departament d’Economia Aplicada, Universitat Autònoma de Barcelona)
    Abstract: In this paper we apply both cross-section and panel analysis to the relationship between fiscal and political decentralization and government quality. We find that fiscal decentralization has a positive impact. Moreover, political decentralization tends to reduce the positive impact of fiscal decentralization on the quality of government. This negative impact of political decentralization on government quality persists when controlling for the degree of democratic maturity of countries but disappears when controlling for the extent of experience with statehood or public administration. This suggests that it is more affordable, in terms of government quality, to combine fiscal and political decentralization in countries with a long history of statehood.
    Keywords: Quality of government, fiscal decentralization, political decentralization, democratic maturity, cross-section and panel data
    Date: 2010–02–01
  7. By: Harold Houba (VU University Amsterdam); Hans-Peter Weikard (Wageningen University, and Mansholt Graduate School)
    Abstract: We introduce the notion of a stone age equilibrium to study societies in which property rights are absent, bilateral exchange is either coercive or voluntary, and relative strength governs power relations in coercive exchange. We stress the importance of free disposal of goods which allows for excess holdings larger than consumption, thereby modelling the power to withhold goods from others. Under complete, transitive, continuous and strictly-convex preferences, stone age equilibria exist. The maximum of the lexicographic welfare function in which agents are ranked by descending strength always corresponds to a stone age equilibrium. Every stone age equilibrium is weakly Pareto efficient.
    Keywords: Power; Exchange Economy; Coercive Trade; Voluntary Trade; Power to Take
    JEL: D0 D7 P0
    Date: 2009–11–04
  8. By: René van den Brink (VU University Amsterdam)
    Abstract: We consider cooperative transferable utility games, or simply TU-games, with a limited communication structure in which players can cooperate if and only if they are connected in the communication graph. A difference between the restricted Banzhaf value and the Myerson value (i.e. the Shapley value of the restricted game) is that the restricted Banzhaf value satisfies collusion neutrality, while the Myerson value satisfies component efficiency. Requiring both efficiency and collusion neutrality for cycle-free graph games yields other solutions such as the hierarchical outcomes and the average tree solution. Since these solutions also satisfy the superfluous player property, this also `solves' an impossibility for TU-games since there is no solution for these games that satisfies efficiency, collusion neutrality and the null player property. We give axiomatizations of the restricted Banzhaf value, the hierarchical outcomes and the average tree solution that are comparable with axiomatizations of the Myerson value in case the communication graph is cycle-free. Finally, we generalize these solutions to classes of solutions for cycle-free graph games using network power measures.
    Keywords: Cooperative TU-game; communication structure; Myerson value; Shapley value; Banzhaf value; hierarchical outcome; average tree solution; component efficiency; collusion neutrality.
    JEL: C71
    Date: 2009–11–25

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