nep-cdm New Economics Papers
on Collective Decision-Making
Issue of 2015‒09‒26
thirteen papers chosen by
Stan C. Weeber, McNeese State University

  1. Crossing Party Lines: The Effects of Information on Redistributive Politics By Casey, Katherine
  2. An Experimental Study of Voting with Costly Delay By Kwiek, Maksymilian; Marreiros, Helia; Vlassopoulos, Michael
  3. Are parliaments with more parties cheaper to Bribe? By Bannikova, Marina; Tasnádi, Attila
  4. No Place like Home: Opinion Formation with Homophily and Implications for Policy Decisions By Önder, Ali Sina; Portmann, Marco; Stadelmann, David
  5. Identification and Estimation of Preference Distributions When Voters Are Ideological By De Paula, Áureo; Merlo, Antonio
  6. Institutional dynamics under revenue volatility and revenue-dependent lobbying power: A stochastic differential game approach By Raouf Boucekkine; Fabien Prieur; Benteng Zou
  7. Redistribution in a Model of Voting and Campaign Contributions By Filipe Campante
  8. Failure at the top: How power undermines collaborative performance By Hildreth, J. Angus D; Anderson, Cameron
  9. Politically Induced Regulatory Risk and Independent Regulatory Agencies By Strausz, Roland
  10. Multilateral Trade Bargaining: A First Look at the GATT Bargaining Records By Kyle Bagwell; Robert W. Staiger; Ali Yurukoglu
  11. Group Formation, In-group Bias and the Cost of Cheating By Michaeli, Moti
  12. The Political Economy of State and Local Investment in Pre-K Programs By Kahn, Matthew E.; Barron, Kyle
  13. The High-Tech Economy, Work, and Democracy 2.0: A Research Agenda By Berins Collier, Ruth

  1. By: Casey, Katherine (Stanford University)
    Abstract: Many lament that weak accountability and poor governance impede economic development in Africa. Politicians rely on ethnic allegiances that deliver the vote irrespective of performance, dampening electoral incentives. Giving voters information about candidate competence counters ethnic loyalty and strengthens accountability. I extend a canonical electoral model to show how information provision flows through voter behavior and ultimately impacts the distribution of political spending. I test the theory on data from Sierra Leone using decentralization and differential radio coverage to identify information's effects. Estimates suggest that information increases voting across ethnic-party lines and induces a more equitable allocation of campaign spending.
    JEL: D72 H41 O17
    Date: 2015–02
  2. By: Kwiek, Maksymilian (University of Southampton); Marreiros, Helia (University of Southampton); Vlassopoulos, Michael (University of Southampton)
    Abstract: A conclave is a voting mechanism in which a committee selects an alternative by voting until a sufficient supermajority is reached. We study experimentally welfare properties of simple three-voter conclaves with privately known preferences over two outcomes and waiting costs. The resulting game is a form of multiplayer war of attrition. Our key finding is that, consistent with theoretical predictions, when voters are ex ante heterogeneous in terms of the intensity of their preferences the conclave leads to efficiency gains relative to simple majority voting. We also compare welfare properties of a static versus a dynamic version of a conclave. When social cost of waiting is taken into account, the dynamic conclave is superior in terms of welfare than its static version.
    Keywords: voting, supermajority, intensity of preferences, war of attrition
    JEL: C78 C92 D72 D74
    Date: 2015–09
  3. By: Bannikova, Marina; Tasnádi, Attila
    Abstract: We collect data about 172 countries: their parliaments, level of corruption, perceptions of corruption of parliament and political parties. We find weak empirical evidence supporting the conclusion that corruption increases as the number of parties increases. To provide a theoretical explanation of this finding we present a simple theoretical model of parliaments formed by parties, which must decide whether to accept or reject a proposal in the presence of a briber, who is interested in having the bill passed. We compute the number of deputies the briber needs to persuade on average in parliaments with different structures described by the number of parties, the voting quota, and the allocation of seats among parties. We find that the average number of seats needed to be bribed decreases as the number of parties increases. Restricting the minimal number of seats a party may have, we show that the average number of seats to be bribed is smaller in parliaments without small parties. Restricting the maximum number of seats a party may have, we find that under simple majority the average number of seats needed to be bribed is smaller for parliaments in which one party has majority, but under qualified majority it hardly changes. Keywords: Bribing, party composition of a parliament, knapsack problem. JEL Classification Number: D73, D72.
    Keywords: Corrupció política, 32 - Política,
    Date: 2015
  4. By: Önder, Ali Sina (Uppsala Center for Fiscal Studies); Portmann, Marco (University of Fribourg.); Stadelmann, David (University of Bayreuth and CREMA)
    Abstract: We demonstrate a simple model of opinion diffusion where a local opinion leader acts as the initiator of public discussion. We show the possibility of driving a significant wedge between opinions of two groups that exhibit homophily even though individuals are highly conformist. In particular, we show that there exists an opinion gap between the group which the opinion leader belongs to (referred to as the residence community) and the other group; and this opinion gap is increasing in the relative size of the residence community. Using a unique dataset of national referenda in Switzerland from 2008 to 2012, we show that members of parliament (MPs) match referenda outcomes in their residence communities closer than they do in neighboring communities, and this wedge interacts signi cantly with the relative size of the residence community, thus aligning with our theoretical conjectures. We conclude that observed opinion gaps can actually be overrated to the extent that they are driven by structures that underlie the social web of different groups within the society.
    Keywords: Opinion Leadership; Diffusion; Homophily; Communication in Networks; Voter Preferences; Representation
    JEL: D72 D85 H79
    Date: 2015–09–12
  5. By: De Paula, Áureo; Merlo, Antonio
    Abstract: This paper studies the nonparametric identification and estimation of voters' preferences when voters are ideological. We establish that voter preference distributions and other parameters of interest can be identified from aggregate electoral data. We also show that these objects can be consistently estimated and illustrate our analysis by performing an actual estimation using data from the 1999 European Parliament elections.
    Keywords: identification; nonparametric; Voronoi tessellation; voting
    JEL: C14 D72
    Date: 2015–09
  6. By: Raouf Boucekkine (GREQAM, Aix Marseille University); Fabien Prieur (INRA and University of Montpellier); Benteng Zou (CREA, Université du Luxembourg)
    Abstract: We propose an analysis of institutional dynamics under uncertainty by the means of a stochastic differential lobbying game with two main ingredients. The first one is uncertainty inherent in the institutional process itself. The second one has to do with the crucial role of resource windfalls in economic and political outcomes, shaping lobbying power and adding a second source of uncertainty. First, we focus on uncertainty surrounding the institutional process only and show that its main consequence is the existence of multiple equilibria with very distinct features: symmetric equilibria which lead the economy to reach almost surely a stable pointwise institutional steady state in the long run even in the absence of the retaliation motive put forward by the deterministic lobbying literature, and asymmetric equilibria which only show up under uncertainty and do no allow for stochastic convergence to a steady state. Second, when accounting for the two sources of uncertainty together with resource revenue-dependent lobbying power, we show that revenue volatility tends to stabilize institutional dynamics compared to the deterministic counterpart.
    Keywords: institutional dynamics, lobbying games, state-dependent lobbying power, revenue volatility, stochastic differential games
    JEL: D72 C61 C63
    Date: 2015
  7. By: Filipe Campante
    Abstract: I propose a framework in which individual political participation can take two distinct forms, voting and contributing resources to campaigns, in a context in which the negligible impact of any individual?s actions on aggregate outcomes is fully recognized by all agents. I then use the framework to reassess the relationship between inequality and redistribution. The model shows that, even though each contribution has a negligible impact, the interaction between contributions and voting leads to an endogenous wealth bias in the political process, as the advantage of wealthier individuals in providing contributions encourages parties to move their platforms closer to those individuals? preferred positions. This mechanism can in turn explain why the standard median-voter-based prediction, that more inequality produces more redistribution, has received little empirical support: Higher inequality endogenously shifts the political system further in favor of the rich. In equilibrium, there is a non-monotonic relationship in which redistribution is initially increasing but eventually decreasing in inequality. I present some empirical evidence supporting the framework, using data on campaign contributions from US presidential elections. In particular, inequality increases contributions to Republicans, but not to Democrats, as predicted by the model.
  8. By: Hildreth, J. Angus D; Anderson, Cameron
    Abstract: All too commonly, we see groups of leaders fail to accomplish their stated goals when working together – legislators who cannot agree on a bill, heads of state who cannot draft meaningful environmental policy, or boards of trustees who make disastrous decisions for their school. The current research examines whether groups of leaders fail as often as they do in part because of the power each leader is accustomed to possessing. Multiple studies found high power individuals , when working in groups, performed worse than did other groups : individuals randomly assigned power in an initial task were less creative when they then worked together in groups on a subsequent task (Study 1A) . Individuals with higher power who worked together in groups were also less likely to reach agreement on a difficult negotiation task , whether these groups comprise d actual executives from an extant organization (Study 2) or students randomly assigned power in the lab oratory (Study 3). Mediation analyses suggest that groups of high power individuals performed worse because they fought over their relative status in the group , were less focused on the task, and shared information with each other less effectively
    Keywords: Social and Behavioral Sciences, power, groups, status, conflict, performance, creativity, negotiation
    Date: 2014–11–01
  9. By: Strausz, Roland
    Abstract: Uncertainty in election outcomes generates politically induced regulatory risk. Political parties' risk attitudes towards such risk depend on a fluctuation effect that hurts both parties and an output--expansion effect that benefits at least one party. Notwithstanding the parties' risk attitudes, political parties have incentives to negotiate away all regulatory risk by pre-electoral bargaining. Efficient pre-electoral bargaining outcomes fully eliminate politically induced regulatory risk. Political parties can implement such outcomes by institutionalizing politically independent regulatory agencies and endowing them with a specific objective.
    Keywords: electoral uncertainty; independent regulatory agency; regulation; regulatory risk
    JEL: D82
    Date: 2015–09
  10. By: Kyle Bagwell (Stanford University and NBER); Robert W. Staiger (Dartmouth College and NBER); Ali Yurukoglu (Stanford University and NBER)
    Abstract: This paper empirically examines recently declassified data from the GATT/WTO on tariff bargaining. We document eight stylized facts about these interconnected high-stakes international negotiations. We use detailed product-level offer and counteroffer data to examine several questions about trade policy, including whether preferential tariffs were a stumbling block towards liberalization, and whether the relaxation of bilateral reciprocity to multilateral reciprocity aided liberalization. We organize the empirical analysis around a theoretical model of multi-party trade negotiations motivated by the terms-of-trade theory and respecting the institutional features of most-favored-nation status and reciprocity.
  11. By: Michaeli, Moti
    Abstract: Group formation and in-group bias - preferential treatment for insiders - are widely observed social phenomena. This paper demonstrates how they arise naturally when people incur a psychological cost as the result of defecting when facing cooperators, when this cost is increasing and concave in the number of such defections. If some group members are asocial, i.e., insusceptible to that cost, then, under incomplete information, free-riding and cooperation can coexist within groups. Signaling of one's type can enable groups to screen out free-riders, but signalling is costly, and its availability may decrease the welfare of all the individuals in society.
    Keywords: In-Group Bias, Group Formation, Costly Signalling, Prisoner's Dilemma Game
    JEL: D7 D03 Z13 D64 D82 C72
    Date: 2015
  12. By: Kahn, Matthew E. (University of California, Los Angeles); Barron, Kyle (University of California, San Francisco)
    Abstract: The expansion of access to publicly provided pre-kindergarten bundles together redistribution to the poor with an early human capital investment. Financing publicly provided pre-K investment is mainly a state and local issue. Which voters favor local pre-K expansion? This paper uses several new data sets to describe the circumstances such that local voters reveal a willingness to spend on an early intervention that may not yield direct benefits for them. Republican voters consistently oppose the expansion of publicly provided pre-K. Suburban voters also tend to oppose such investment. We explore several possible explanations for these facts.
    Keywords: early childhood investment, voting, urban, suburban
    JEL: H41
    Date: 2015–09
  13. By: Berins Collier, Ruth
    Abstract: The current techno - economic transformation, or Algorithmic Revolution, has wide - ranging consequences for society, posing many challenges of economic policy. At a macro level, it has been associated with rising inequality, “disruption†of many economic sectors, and the destruction of many jobs as well as the creation of others, with still unknown net effects. At the micro level, it has generated a particular type of employment relations: while the industrial revolution was associated with wage labor, often in large concentrations of workers, the current revolution is associated with a shift from employees to what might be called micro - entrepreneurs, who are often widely dispersed. This paper addresses the political effects of these transformations — specifically the effects on the structure of popular interest representation regarding these policies of economic regulation. These changes may be profoundly affecting the nature of mass democracy in the 21st century, or Democracy 2.0. The new worlds of work, by atomizing workers and challenging unions, makes collective action more difficult, particularly around “productionist†policies — micro and macroeconomic outcomes of the techno - economic transformation a s it unfolds . A host of important questions are raised. What role can unions still play in addressing these issues? Can other organizations, which have emerged around other kinds of issues, engage economic or productionist policies effectively? What is the role of social media in coordinating action not only for protest but also for organizing and providing policy input? Through raising these questions, this paper proposes an agenda of comparative research for examining the capacity of citizens to engage the policies that may guide the goals of technology development, how technology is implemented, and how its social and economic consequences are regulated
    Keywords: Social and Behavioral Sciences
    Date: 2015–07–01

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