nep-cdm New Economics Papers
on Collective Decision-Making
Issue of 2015‒01‒31
ten papers chosen by
Stan C. Weeber, McNeese State University

  1. Power indices when players can commit to reject coalitions By László Á. Kóczy
  2. Hearing the voice of future generations: A laboratory experiment of ``Demeny voting’’ By Yoshio Kamijo ; Yoichi Hizen ; Tatsuyoshi Saijo
  3. Give Everybody a Voice! The Power of Voting in a Public Goods Experiment with Externalities By Christoph Engel ; Bettina Rockenbach
  4. Intergenerational Politics, Government Debt, and Economic Growth By Tetsuo Ono
  5. Farmer groups as a device to ensure the provision of green services in the Netherlands: a political economy perspective By Jongeneel, Roel ; Pollman, Nico
  6. Of the stability of partnerships when individuals have outside options, or why allowing exit is inefficient By Alexia Gaudeul ; Paolo Crosetto ; Gerhard Riener
  7. Religious fragmentation, social identity and cooperation: Evidence from a artefactual field experiment in India By Surajeet Chakravarty ; Miguel A. Fonseca ; Sudeep Ghosh ; Sugata Marjit
  8. Global environmental agreements and international trade: Asymmetry of countries matters By Thomas Eichner ; Rüdiger Pethig
  9. Policy convergence across welfare regimes: the case of disability policies By Ágota Scharle ; Balázs Váradi ; Flóra Samu
  10. Emergence of cooperatives and farmer heterogeneity By Petruchenya, Anna ; Hendrikse, George

  1. By: László Á. Kóczy (Óbuda University )
    Abstract: Power indices have been used to evaluate the allocation of power in a wide range of voting situations. While they use the language of game theory known measures of a priori voting power are hardly more than statistical expectations assuming the random behaviour of the players. We introduce a model where players can reject certain partnerships in cooperation. For normalised indices strategic rejection may increase power. Our notion of a strategic power index is well dened if power is measured by an index that takes only minimal winning coalitions into account. Keywords and phrases: quarrelling, rejected coalitions, a priori voting power, power indices, minimal winning coalitions, rational players.
    Keywords: Apportionment, voting, elections, Venice Commission, proportionality, lexicographic ordering JEL Codes: C71, D71.
    Date: 2013–11
  2. By: Yoshio Kamijo (School of Economics and Management, Kochi University of Technology ); Yoichi Hizen (School of Economics and Management, Kochi University of Technology ); Tatsuyoshi Saijo (School of Economics and Management, Kochi University of Technology )
    Abstract: We report the first experimental evidence on the effect of ``Demeny voting,’’ wherein some people (e.g., parents) are given additional votes as proxy for the future generation (e.g., their children). In our experiment, three subjects are separated into the present and future generations, two of them regarded as the present generation. The present generation members are asked to determine the resource allocation between the present and future generations by majority voting. We compare voting behaviors and outcomes between ordinary majority voting (i.e., each of the two in the present generation has one vote) and Demeny voting (i.e., one of the two has two votes while the other has one vote). We obtain mixed evidence on whether the outcome of Demeny voting reflects the interest of the future generation. A remarkable finding is that half of the subjects who voted in favor of the future generation under ordinary voting reversed their decisions when they were given only one vote under Demeny voting; that is, they voted in favor of the present generation. This finding highlights the need, when planning to introduce Demeny voting, to consider the behaviors of not only people who are given additional votes but also those with only one vote. Finally, we compare voting behaviors between male and female subjects. We find that female subjects use their additional votes for the future generation more frequently than male subjects do, implying that women are less likely to abuse their proxy position than are men.
    Keywords: Aging Society, Demeny Voting, Laboratory Experiment
    JEL: C91 D72 J13
    Date: 2015–01
  3. By: Christoph Engel (Max Planck Institute for Research on Collective Goods, Bonn ); Bettina Rockenbach (University of Cologne )
    Abstract: We study the effect of voting when insiders’ public goods provision may affect passive outsiders. Without voting insiders’ contributions do not differ, regardless of whether outsiders are positively or negatively affected or even unaffected. Voting on the recommended contribution level enhances contributions if outsiders are unaffected and internalizes the negative externality by lowering contributions when outsiders are negatively affected. Remarkably, voting does not increase contributions when it would be most desirable, i.e. with a positive externality. Here, participants vote for high contributions, yet compliance is poor. Unfavorable payoff comparisons to the outsiders that gain a windfall profit drive contributions down.
    Keywords: experiment, Public Good, externality, voting
    JEL: H41 D43 L13 C92 C91 D62 D03 H23
    Date: 2014–11
  4. By: Tetsuo Ono (Graduate School of Economics, Osaka University )
    Abstract: This study presents a two-period overlapping-generations model featuring en- dogenous growth and intergenerational conflict over fiscal policy. In particular, we characterize a Markov-perfect political equilibrium of the voting game between gen- erations, and show the following results. First, population aging incentivizes the government to invest more in capital for future public spending, and thus produces a positive effect on economic growth. Second, when the government finances its spending by issuing bonds, an introduction of a balanced budget rule results in a higher growth rate. Third, to obtain a normative implication of the political equi- librium, we compare it to an allocation chosen by a benevolent planner who takes care of all future generations. Here, we show that the political equilibrium attains a lower growth rate than that in the planner's allocation.
    Keywords: Economic Growth; Government Debt; Overlapping Generations; Pop- ulation Aging; Voting
    JEL: D72 D91 H63
    Date: 2014–06
  5. By: Jongeneel, Roel ; Pollman, Nico
    Abstract: The latest reform of the CAP, CAP towards 2020, opens up the possibility to arrange agri-environmental service provision via contracting groups of farmers, rather than contracting individual farmers. The Dutch government decided to fully switch to a farmer group service provision system in 2016. The paper analyses the new organisational framework that now is derived and links it to the Dutch tradition of environmental cooperatives. Issues of collective action, transaction costs, information problems, effectiveness, accountability, and procurement efficiency are analysed in a qualitative way. It is concluded that the Dutch model is promising, although not without risks. Its implementation path seems properly chosen. However, in order to fully reap the benefits possible under the new system one need to reduce restrictions and increase incentives.
    Keywords: agri-environmental scheme, collective action, transaction costs, procurement, Agricultural and Food Policy, Environmental Economics and Policy, Political Economy,
    Date: 2014–09
  6. By: Alexia Gaudeul (DFG RTG 1411, Friedrich-Schiller-Universität Jena ); Paolo Crosetto (UMR GAEL INRA, Université Pierre Mendès France, Grenoble ); Gerhard Riener (DICE, Heinrich-Heine-Universität Düsseldorf )
    Abstract: Should people be allowed to leave joint projects freely or should they be deterred from breaking off? This depends on why people stop collaborating and whether they have good reasons to do so. We explore the factors that lead to the breakdown of partnerships by studying a public good game with imperfect public monitoring and an exit option. In our experiment, subjects were assigned a partner with whom they could contribute over several periods to a public good with stochastic outcomes. They could choose in each period between participating in the public project or working on their own. We find there was excessive exit especially because subjects over-estimated the likelihood their partner would leave. Treatments with high barriers to exit generated higher welfare overall as they fostered stability and prevented inefficient breakdowns in relationships. There were differences across treatments in the intensity with which different factors drove the choice to work alone. Differences in expected payoffs between independent and group work were more important as a driver of exit in treatments with low barriers to exit. The intensity of other factors was more constant across treatments, including whether the common project failed in the previous period, the belief that one's partner did not want to maintain the partnership and the belief that he exerted less effort than oneself.
    Keywords: barriers to exit, cooperation, outside option, imperfect public monitoring, partnerships, public good game, repeated game, social risk
    JEL: C23 C92 H41
    Date: 2015–01–15
  7. By: Surajeet Chakravarty (Department of Economics, University of Exeter ); Miguel A. Fonseca (Department of Economics, University of Exeter ); Sudeep Ghosh (Hong Kong Polytechnic University ); Sugata Marjit (Center for Studies in the Social Sciences, Calcutta. )
    Abstract: We study the role of village-level religious fragmentation on intra- and inter-group cooperation in India. We report on data on two-player Prisoners’ Dilemma and Stag Hunt experiments played by 516 Hindu and Muslim participants in rural India. Our treatments are the identity of the two players and the degree of village-level religious heterogeneity. In religiously-heterogeneous villages, cooperation rates in the Prisoners’ Dilemma are higher when subjects play with another in-group member for both Hindus and Muslims, but to a much lesser extent in the Stag Hunt game. This suggests that positive in-group biases operate primarily on the willingness to achieve socially efficient outcomes, rather than through beliefs about the actions by one's counterpart. Interestingly, cooperation rates among people of the same religion are significantly lower in homogeneous villages than in fragmented villages in both games. This is likely because a sense of group identity is only meaningful in the presence of an out-group. This, together with little evidence for out-group prejudice in either game, means religious diversity is beneficial.
    Keywords: Social Identity, Social Fragmentation, Artefactual Field Experiment.
    JEL: C93 D03 H41
    Date: 2015
  8. By: Thomas Eichner ; Rüdiger Pethig
    Abstract: We investigate the formation of global climate agreements (= stable grand climate coalitions) in a model, in which climate policy takes the form of carbon emission taxation and fossil fuel and consumption goods are traded on world markets. We expand the model of Eichner and Pethig (2014) by considering countries that are identical within each of two groups but differ across groups with respect to climate damage or fossil fuel demand. Our numerical analysis suggests that climate damage asymmetry tends to discourage cooperation in the grand coalition. The effects of fuel-demand asymmetry depend on fossil fuel abundance. If fuel is very abundant, the grand coalition fails to be stable independent of the degree of fuel demand asymmetry. If fuel is sufficiently scarce, low degrees of fuel demand asymmetry discourage cooperation whereas higher degrees of asymmetry stabilize the grand coalition.
    Keywords: fuel demand, climate damage, international trade, asymmetry, stability, grand coalition
    JEL: C72 F02 Q50 Q58
    Date: 2014
  9. By: Ágota Scharle ; Balázs Váradi ; Flóra Samu
    Abstract: Drawing on the analysis in MS9, this paper summarises the policy relevant lessons on what drives and hinders institutional change in services for people with disabilities in EU Member States, and offers some recommendations on how such changes may be facilitated. The focus is mainly on the implications of the reform capacity of various welfare regime types.
    Keywords: Challenges for welfare system, Good governance, Institutional reforms, Labour markets, Multi-level governance, Policy options, Political economy of policy reform, Social development, Social innovation, Welfare reform, Welfare state
    JEL: D78 H75 I38
    Date: 2015–01
  10. By: Petruchenya, Anna ; Hendrikse, George
    Abstract: This paper studies different patterns of emergence of cooperatives. We examine how heterogeneity of farmers, reflected in a distance measure, affects equilibrium outcomes. Our results show that when distance costs are low, cooperative emerges bottom-up. With medium distance costs, one of the farmers takes an initiative. With high distance costs, no cooperative emerges. Including an outsider in the game changes equilibrium strategies of players. Under complete information, cooperative is either formed with an initiative of one farmer or it emerges top-down with outsider’s support. When information is incomplete, cooperative can emerge bottom-up, i.e. with two active farmers, or top-down.
    Keywords: Cooperative emergence, heterogeneity, life cycle, Institutional and Behavioral Economics,
    Date: 2014–08

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