nep-cdm New Economics Papers
on Collective Decision-Making
Issue of 2015‒11‒21
nine papers chosen by
Stan C. Weeber, McNeese State University

  1. Stability in electoral competition: A case for multiple votes By Dimitrios Xefteris
  2. Voting and transfer payments in a threshold public goods game By Feige, Christian; Ehrhart, Karl-Martin
  3. Elected Officials’ Opportunistic Behavior on Third-Party Punishment: An Experimental Analysis By Natalia Jiménez; Ángel Solano-García
  4. Understanding the 2015 Marriage Referendum in Ireland: Constitutional Convention, Campaign, and Conservative Ireland By Johan A. Elkink; David M. Farrell; Theresa Reidy; Jane Suiter
  5. Role of Human Resource Practices in Absorptive Capacity and R&D Cooperation By Ipsita Roy
  6. How forced displacement flows affect public good contributions: The social consequences of conflict in Colombia By Hopfensitz, Astrid; Miquel-Florensa, Josepa
  7. Asymmetric yardstick competition and municipal cooperation By Giuranno, Michele; Di Liddo, Giuseppe
  8. Multilateral versus sequential negotiations over climate change By PEREAU Jean-Christophe; CAPARROS Alejandro
  9. Centralized vs. Decentralized Management: an Experimental Study By Jordi Brandts; David J. Cooper

  1. By: Dimitrios Xefteris
    Abstract: It is well known that the Hotelling-Downs model generically fails to admit an equilibrium when voting takes place under the plurality rule (Osborne 1993). This paper studies the Hotelling-Downs model considering that each voter is allowed to vote for up to k candidates and demonstrates that an equilibrium exists for a non-degenerate class of distributions of voters’ ideal policies - which includes all log-concave distributions - if and only if (k=2). That is, the plurality rule (k=1) is shown to be the unique k-vote rule which generically precludes stability in electoral competition. Regarding the features of k-vote rules’ equilibria, first, we show that there is no convergent equilibrium and, then, we fully characterize all divergent equilibria. We study comprehensively the simplest kind of divergent equilibria (two-location ones) and we argue that, apart from existing for quite a general class of distributions when k = 2, they have further attractive properties - among others, they are robust to free-entry and to candidates’ being uncertain about voters’ preferences.
    Keywords: Hotelling-Downs model, equilibrium, multiple votes.
    Date: 2015–11
  2. By: Feige, Christian; Ehrhart, Karl-Martin
    Abstract: In a laboratory experiment, we investigate if groups consisting of two heterogeneous player types (with different marginal contribution costs) can increase their total contributions and payoffs in a threshold public goods game if transfer payments are possible among the players. We find that transfer payments are indeed used in many groups to shift contributions from high-cost players to low-cost players, thereby not only increasing social welfare, but also equalizing payoffs. In a repeated setting with individual voluntary contributions and transfers, this redistribution effect takes a few rounds to manifest and high-cost players benefit the most in terms of payoffs. The same beneficial effect of transfer payments can also be achieved in a one-shot setting by having the groups vote unanimously on contributions and transfers of all players.
    Keywords: threshold public good,transfer payments,experimental economics,unanimous voting,committee,heterogeneity
    JEL: C92 D71 H41
    Date: 2015
  3. By: Natalia Jiménez (Dpto. Teoría e Historia Económica); Ángel Solano-García (Dpto. Teoría e Historia Económica)
    Abstract: In this paper we analyze how the punishment behavior of a democratically elected official varies when facing an electoral process (opportunism). To this aim, we conduct an economic experiment in which officials are third party punishers in a public goods game. We consider two different scenarios which differ in the degree of cooperation within the society. We¿find that officials increase their punishment when they face elections in both scenarios. Contrary to candidates expectations, voters always vote for the least severe candidate. En este artículo se analiza como el comportamiento sancionador varía si el que decide el grado de la sanción es elegido democráticamente o no. Para esto realizamos un experimento de laboratorio en el que unos sancionadores externos pueden castigar el comportamiento no cooperativo en un juego de bienes públicos. Consideramos dos posibles escenarios, uno donde existe una gran cooperación y otro donde ésta es escasa. Nuestros resultados muestran que aquellos sancionadores que se enfrentan a un proceso electoral son más duros en su castigo en ambos escenarios. Sin embargo, contrariamente a las expectativas de los candidatos, los votantes votan por el candidato menos severo.
    Keywords: Oportunismo, castigo, juego de bienes públicos, votación, experimentos de laboratorio. Opportunism, Punishment, Public Goods Games, Voting, Experiments
    JEL: C92 D72 H4
    Date: 2015–11
  4. By: Johan A. Elkink (School of Politics and International Relations and Geary Institute for Public Policy, University College Dublin); David M. Farrell (School of Politics and International Relations, University College Dublin); Theresa Reidy (Department of Government, University College Cork); Jane Suiter (Institute for Future Media and Journalism, School of Communications, Dublin City University)
    Abstract: On 22 May 2015 the marriage referendum proposal was passed by a large majority of Irish voters and the definition of marriage in the constitution was broadened to introduce marriage equality. This referendum is remarkable for a number of reasons: (1) it is uniquely based on an experiment in deliberative democracy; (2) the referendum campaign was unusually vigorous and active; and (3) the voting patterns at the referendum point to a significant value shift along the deep seated liberal conservative political cleavage of Irish politics. This article provides an overview of the background to the referendum initiative, the campaign prior to the referendum, and the key factors that drove voter turnout and preference. Based on a post-referendum survey, we find that while support for the government of the day, political knowledge, and social attitudes have the same effects as commonly found in other referendums, the variation among social classes was less prevalent than usual and door-to-door canvassing by the two sides of the campaign impacted through turnout rather than vote preference. The voting behaviour of the different age groups suggests strong generational effects.
    Keywords: political campaigns; electoral behaviour, referendums; constitutional convention; marriage equality
    JEL: D72
    Date: 2015–11–09
  5. By: Ipsita Roy (Graduate College "The Economics of Innovative Change", Friedrich Schiller University Jena, and Max Planck Institute of Economics.)
    Abstract: While significant attention is given to the concept of absorptive capacity as a source of competitive advantage in firms, a major drawback exists in the way it is unidimensionally defined in micro-level analysis. The paper addresses this limitation and reconceptualizes absorptive capacity as a strategic human resource construct in firms, which in turn, provide important conditions for R&D cooperation and innovation. I begin by providing a "beyond-R&D" definition of absorptive capacity constituting employment practices and incentive-based compensation programs. Next, I exploit the relationship between these practices and heterogeneity in firms' R&D cooperation and partner selection strategies distinguishing between different types of external collaboration partners- horizontal, institutional and consulting-based. Further, I examine the impact of such cooperative R&D on incremental product, process and radical innovation. Employing the IAB Establishment Panel Survey on about 1200 German innovation-based establishments during 2007-2011, findings demonstrate that adoption of employment practices positively affects R&D cooperation irrespective of the type of collaboration partner, while compensation programs positively affect only horizontal R&D cooperation. Significant differences in the patterns of research collaboration are found between manufacturing and service sector firms, with respect to importance of human resource management, educational structure of the workforce and internal R&D. Finally, cooperative R&D with research institutes and consulting firms are found to have significantly positive impact on the likelihood of coming up with incremental product, process and radical innovation, but the effect is relatively weak in case of horizontal R&D cooperation.
    Keywords: Absorptive capacity, strategic human resource, employment practices, compensation programs, R&D cooperation, innovation
    JEL: J21 J24 J33 L20 M12
    Date: 2015–11–19
  6. By: Hopfensitz, Astrid; Miquel-Florensa, Josepa
    Abstract: Low intensity armed conflict is usually related to population displacement, altering networks and social capital in affected regions. With an incentivized questionnaire performed in the Colombian coffee growing axis (Eje Cafetero), we observe contribution to an abstract and anonymous public good when contributions are not enforceable. Game contributions are significantly higher in regions with high net-changes of population due to displacement, both for regions with net in-flow and net out-flow, compared to a more stable area. We find that the effect is especially strong for women in net out-flow areas; usually the most affected if male family members are forcibly displaced. We further propose a local inspection mechanism, and show that it increases contributions in all areas independently of the displacement history of the location and the individuals preferences with respect to this mechanism.
    Keywords: Colombia ; conflict ; displacement ; public good games
    Date: 2014–01
  7. By: Giuranno, Michele; Di Liddo, Giuseppe
    Abstract: This paper addresses the issue of inter-jurisdictional cooperation when incumbents are pure rent seekers. Asymmetric fiscal needs bias yardstick competition as in Allers (2012). While incumbents gain control over the political yardstick competition by cooperating, this bias leads to asymmetric rent share. Cooperation is also intrinsically unstable. Furthermore, incentives, such as matching grants or economies of scale, may enhance cooperation, but will not increase political accountability.
    Keywords: Decentralization; expenditure needs disparities; municipal cooperation.
    JEL: D72 H77
    Date: 2015–11
  8. By: PEREAU Jean-Christophe; CAPARROS Alejandro
    Abstract: We discuss a model of gradual coalition formation with positive externalities in which a leading country endogenously decides whether to negotiate multilaterally or sequentially over climate change. We show that the leader may choose a sequential path, and that the choice is determined by the convexity of the TU-game and the free-rider payoffs of the followers. Except in a few clearly defined cases, the outcome of the negotiation process is always the grand coalition, although the process may need some time. This holds for the standard IEA game with heterogeneous players even if the grand coalition is not stable in a multilateral context. We also analyze the role of a facilitating agency. The agency has an incentive to speed up intra-stage negotiations and to extend the period between negotiation stages in a sequential process.
    Keywords: multilateral bargaining, endogenous coalition formation, international negotiations, mediator, international environmental agreements.
    JEL: Q54
    Date: 2015
  9. By: Jordi Brandts; David J. Cooper
    Abstract: We introduce a new game to the experimental literature and use it to study how behavioral phenomena affect the tradeoffs between centralized and decentralized management. Our game models an organization with two divisions and one central manager. Each division must choose or be assigned a product. Ignoring asymmetric information, the underlying game is an asymmetric coordination game related to the Battle of the Sexes. In equilibrium, the divisions coordinate on identical products. Each division prefers an equilibrium where the selected products are closest to its local tastes while central management prefers the efficient equilibrium, determined by a randomly state of the world, which maximizes total payoffs. The state of the world is known to the divisions, but the central manager only learns about it through messages from the divisions who have incentives to lie. Contrary to the theory, overall performance is higher under centralization, where the central manager assigns products to divisions after receiving messages from the divisions, than under decentralization where the divisions choose their own products. Underlying this, mis-coordination is common under decentralization and divisions fail to use their information when they do coordinate. Mis-coordination is non-existent under centralization and there is a high degree of truth-telling by divisions as well. Performance under centralization is depressed by persistent sub-optimal use of information by central managers.
    Keywords: Coordination, experiments, Organizations, Asymmetric Information
    JEL: C92 D23 J31 L23 M52
    Date: 2015–11

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