New Economics Papers
on Collective Decision-Making
Issue of 2010‒09‒03
five papers chosen by

  1. Participatory Decision Making: A Field Experiment on Manipulating the Votes By Paolo Spada; Raymond Vreeland
  2. When Winning is the Only Thing:  Pure Strategy Nash Equilibria in a Three-Candidate Spatial Voting Model By Richard Chisik; Robert J. Lemke
  3. Competitive Equilibrium in Markets for Votes By Alessandra Casella; Aniol Llorente-Saguer; Thomas R. Palfrey
  4. Power Indices in Large Voting Bodies By Leech, Dennis
  5. The necessary and sufficient condition for the transitivity of the Majority Rule in the linear domain By Xefteris, Dimitrios

  1. By: Paolo Spada; Raymond Vreeland
    Abstract: Many believe that deliberative democracy, where individuals discuss alternatives before voting on them, should result in collectively superior outcomes because voters become better informed and decisions are justified using reason. These deliberations typically involve a moderator, however, whose role has been under-examined. We conduct a field experiment to test the effects moderators may have. Participants in a class of 107 students voted on options over their writing and exam requirements. Before voting, they participated in group discussions of about five people each with one moderator. Some (randomly assigned) moderators remained neutral throughout, while others made limited interventions, supporting a specific option. We find a substantial moderator effect. Our experiment is structured like deliberations used world-wide to make community decisions and thus should have some external validity. The results indicate that if organized interest groups had influence over moderators, they might be able to hijack a deliberative decision-making process.
    Keywords: Participatory Decision Making, Field Experiment, Voting.
    JEL: G10 G30 G34 G38 K20 K22
    Date: 2010–08–19
  2. By: Richard Chisik (Department of Economics, Ryerson University, Toronto, Canada); Robert J. Lemke (Department of Economics, Lake Forest College, Lake Forest, Illiniois)
    Abstract: It is well-known that there are no pure strategy Nash equilibria (PSNE) in the standard three-candidate spatial voting model when candidates maximize their share of the vote. When all that matters to the candidates is winning the election, however, we show that PSNE do exist. We provide a complete characterization of such equilibria and then extend our results to elections with an arbitrary number of candidates. Finally, when two candidates face the potential entrant of a third, we show that PSNE no longer exist, however, they do exist when the number of existing candidates is at least three.
    Keywords: Voting, spatial equilibrium, location models, entry.
    JEL: C7 D0 H8 R1
    Date: 2010–08
  3. By: Alessandra Casella; Aniol Llorente-Saguer; Thomas R. Palfrey
    Abstract: We develop a competitive equilibrium theory of a market for votes. Before voting on a binary issue, individuals may buy and sell their votes with each other. We define the concept of Ex Ante Vote-Trading Equilibrium, identify weak sufficient conditions for existence, and construct one such equilibrium. We show that this equilibrium must always result in dictatorship and the market generates welfare losses, relative to simple majority voting, if the committee is large enough. We test the theoretical implications by implementing a competitive vote market in the laboratory using a continuous open-book multi-unit double auction.
    JEL: C72 C92 D70 P16
    Date: 2010–08
  4. By: Leech, Dennis (Department of Economics, University of Warwick)
    Abstract: There is no consensus on the properties of voting power indices when there are a large number of voters in a weighted voting body. On the one hand, in some real-world cases that have been studied the power indices have been found to be nearly proportional to the weights (eg the EUCM, US Electoral College). This is true for both the PenroseBanzhaf and the Shapley-Shubik indices. It has been suggested that this is a manifestation of a conjecture by Penrose (known subsequently as the Penrose limit theorem, that has been shown to hold under certain conditions). On the other hand, we have the older literature from cooperative game theory, due to Shapley and his collaborators, showing that, where there are a nite number of voters whose weights remain constant in relative terms, and where the quota remains constant in relative terms, while the total number of voters increases without limit - so called oceanic games - the powers of the voters with nite weight tend to limiting values that are, in general, not proportional to the weights. These results, too, are supported by empirical studies of large voting bodies (eg. the IMF/WB boards, corporate shareholder control). This paper proposes a restatement of the Penrose Limit theorem and shows that, for both the power indices, convergence occurs in general, in the limit as the Laakso-Taagepera index of political fragmentation increases. This new version reconciles the di erent theoretical and empirical results that have been found for large voting bodies
    Date: 2010
  5. By: Xefteris, Dimitrios
    Abstract: This paper identifies the necessary and sufficient condition for the transitivity of the majority rule when individuals are never indifferent between two distinct alternatives (linear domain). By introducing the concept of the relevant population for each set of alternatives, a unique condition can be stated, and substitute the variety of conditions that already exist in the literature.
    Keywords: majority rule; transitivity
    JEL: D70 D71
    Date: 2010–05–01

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