New Economics Papers
on Collective Decision-Making
Issue of 2011‒04‒30
seven papers chosen by

  1. Voting rules as statistical estimators By Pivato, Marcus
  2. Divisive Politics and Accountability By Aron Kiss
  3. Measuring Power and Satisfaction in Societies with Opinion Leaders : An Axiomatization By René Van Den Brink; Agnieszka Rusinowska; Frank Steffen
  4. Subgame perfect implementation: A new result By Wu, Haoyang
  5. Computations on Simple Games using REL VIEW By Rudolf Berghammer; Agnieszka Rusinowska; Harrie De Swart
  6. Incentives and the delegation of decision making power in sovereign wealth funds By Artur Grigoryan
  7. Tullock Challenges: Happiness, Revolutions and Democracy By Bruno S. Frey

  1. By: Pivato, Marcus
    Abstract: We adopt an `epistemic' interpretation of social decisions: there is an objectively correct choice, each voter receives a `noisy signal' of the correct choice, and the social objective is to aggregate these signals to make the best possible guess about the correct choice. One epistemic method is to fix a probability model and compute the maximum likelihood estimator (MLE), maximum a posteriori estimator (MAP) or expected utility maximizer (EUM), given the data provided by the voters. We first show that an abstract voting rule can be interpreted as MLE or MAP if and only if it is a scoring rule. We then specialize to the case of distance-based voting rules, in particular, the use of the median rule in judgement aggregation. Finally, we show how several common `quasiutilitarian' voting rules can be interpreted as EUM.
    Keywords: voting; maximum likelihood estimator; maximum a priori estimator; expected utility maximizer; statistics; epistemic democracy; Condorcet jury theorem; scoring rule
    JEL: D81 D70 C44
    Date: 2011–04–13
  2. By: Aron Kiss (National Bank of Hungary)
    Abstract: The paper analyzes a political accountability game with an electorate of 'partisan' and 'independent' voters. It is shown that politicians have a strategic incentive to engage in 'divisive politics', that is, to force some independent voters to take sides, even if the direct electoral benefits are higher for their opponents than for themselves. By polarizing the electorate, the incumbent politician weakens the ability of independent voters to make him accountable for his policies in the common interest. Moreover, the interests of the incumbent and the opposition are aligned: the opposition also benefits from divisive politics because, in equilibrium, its election probability increases.
    Keywords: political accountability, political agency, divisive politics, democracy in divided societies
    JEL: D72
    Date: 2011–04
  3. By: René Van Den Brink (Department of Econometrics - Timbergen Institute - VU University); Agnieszka Rusinowska (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I); Frank Steffen (University of Liverpool Management School (ULMS) - University of Liverpool Management School)
    Abstract: A well-known model in sociology and marketing is that of opinion leadership. Opinion leaders are actors who are able to affect the behavior of their followers. Hence, opinion leaders have some power over their followers, and they can exercise this power by influencing their followers choice of action. We study a two-action model for a society with opinion leaders. We assume that each member of the society has an inclination to choose one of these actions and that the collective choice is made by simple majority of the actions chosen by each member. For this model, we axiomatize satisfaction and power scores, which allow us to investigate the effects of different opinion leader-follower structures.
    Keywords: Collective choice, follower, opinion leader, power, satisfaction, axiomatization.
    Date: 2011–03
  4. By: Wu, Haoyang
    Abstract: This paper concerns what will happen if quantum mechanics is concerned in subgame perfect implementation. The main result is: When additional conditions are satisfied, the traditional characterization on subgame perfect implementation shall be amended by virtue of a quantum stage mechanism. Furthermore, by using an algorithmic stage mechanism, this amendment holds in the macro world too.
    Keywords: Mechanism design; Subgame perfect implementation; Quantum game theory.
    JEL: D71
    Date: 2011–04–13
  5. By: Rudolf Berghammer (Institut für Informatik - Universitat Kiel); Agnieszka Rusinowska (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I); Harrie De Swart (Department of Philosophy - Erasmus University Rotterdam)
    Abstract: Simple games are a powerful tool to analyze decision-making and coalition formation in social and political life. In this paper we present relational models of simple games and develop relational algorithms for solving some game-theoretic basic problems. The algorithms immediately can be transformed into the language of the Computer Algebra system RelView and, therefore, the system can be used to solve the problems and to visualize the results of the computations. As an example, we consider the German parliament after the 2009 election.
    Keywords: Simple games, relation algebra, RelView.
    Date: 2011–03
  6. By: Artur Grigoryan
    Abstract: The paper models the incentives of a politician to delegate the decision making power in a sovereign wealth fund to an independent external manager. It formalizes the learning-effects as well as the increase of transparency of the SWF and the rise of investment possibilities associated with higher transparency. It also focuses on the role of elections as a basic mechanism to control and discipline politicians. I show that the politician has incentives for strategic behaviour if voters have incomplete information about his competence. The paper also studies when the delegation of decision making power is socially optimal and under which circumstances it takes place.
    Keywords: Sovereign Wealth Fund (SWF), transparency, policy delegation, external management
    JEL: D7 E6 F3 G2
    Date: 2011
  7. By: Bruno S. Frey
    Abstract: Gordon Tullock has been one of the most important founders and contributors to Public Choice. Two innovations are typical "Tullock Challenges". The first relates to method: the measurement of subjective well-being, or happiness. The second relates to digital social networks such as Facebook, Twitter, or to some extent Google. Both innovations lead to strong incentives by the governments to manipulate the policy consequences. In general "What is important, will be manipulated by the government". To restrain government manipulation one has to turn to Constitutional Economics and increase the possibilities for direct popular participation and federalism, or introduce random mechanisms.
    Keywords: Happiness, social networks, constitutional economics, random mechanisms, public choice
    JEL: D72 H10 I31 P16 D02
    Date: 2011–04

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