nep-cdm New Economics Papers
on Collective Decision-Making
Issue of 2017‒11‒19
twelve papers chosen by
Stan C. Weeber, McNeese State University

  1. Biased Policy and Political Behavior By Avi Ben-Bassat; Momi Dahan
  2. Do gender preference gaps impact policy outcomes? By Eva Ranehill; Roberto A. Weber
  3. Behavioural types in public goods games: A re-analysis by hierarchical clutering By Francesco Fallucchi; R. Andrew Luccasen; Theodore L. Turocy
  4. Where do fairness preferences come from? Norm transmission in a teen friendship network By David Hugh-Jones; Jinnie Ool
  5. Internet and Politics: Evidence from U.K. Local Elections and Local Government Policies By Alessandro Gavazza; Mattia Nardotto; Tommaso M. Valletti
  6. Stabilized Branch-and-Price Algorithms for Vector Packing Problems By Philipp Harms; Claudia Landwehr
  7. The productivity puzzle and the problem with the rich: An experiment on competition, inequality and "team spirit" By Shaun P. Hargeaves Heap; Abhijit Ramalingam; Brock V. Stoddard
  8. The Delegate Paradox: Why Polarized Politicians Can Represent Citizens Best By Ahler, Douglas J.; Broockman, David E.
  9. Individual and group preferences over risk: does group size matter? By Morone, Andrea; Temerario, Tiziana; Nemore, Francesco
  10. Ideology or Voters? A Quasi-Experimental Test of Why Left-Wing Governments Spend More By Benoît Le Maux; Kristýna Dostálová; Fabio Padovano
  11. Globalization, Political Orientation and Wage Inequality: From Donald Trump’s Election to Angela Merkal’s Re-Election By Mamoon, Dawood
  12. Group behaviour in tacit coordination games with focal points: An experimental investigation By Stefania Sitzia; Jiwei Zheng

  1. By: Avi Ben-Bassat; Momi Dahan
    Abstract: Unlike the previous literature on mass policy feedback, the present paper argues that a negative message embodied in public policy may foster or dampen political participation depending on social group affiliation. The policy change we use to examine the effect of biased policy (a negative message) on political behavior is the removal of elected mayors that were replaced by an appointed committee in a large number of Arab and Jewish municipalities in Israel which was skewed significantly towards Arab municipalities. We show that Arab voters in intervened municipalities are more likely to show up in the ballot boxes in national elections and they tend to vote more for Arab parties. In contrast, the political participation of Jewish citizens is lower in municipalities with an appointed council without noticeable effect on vote choice.
    Keywords: policy feedback, political participation, vote choice
    JEL: D70 D72 D74
    Date: 2016
  2. By: Eva Ranehill; Roberto A. Weber
    Abstract: Many studies document systematic gender differences in a variety of important economic preferences, such as risk-taking, competition and pro-sociality. One potential implication of this literature is that increased female representation in decision-making bodies may significantly alter organizational and policy outcomes. However, research has yet to establish a direct connection from gender differences in simple economic choice tasks, to voting over policy and to the resulting outcomes. We conduct a laboratory experiment to provide a test of such a connection. In small laboratory “societies,” people repeatedly vote for a redistribution policy and engage in a real-effort production task. Women persistently vote for more egalitarian redistribution. This gender difference is large relative to other voting differences based on observable characteristics and is partly explained by gender gaps in preferences and beliefs. Gender voting gaps persist with experience and in environments with varying degrees of risk. We also observe policy differences between male- and female-controlled groups, though these are considerably smaller than the mean individual differences—a natural consequence of the aggregation of individual preferences into collective outcomes. Thus, we provide evidence for why substantial and robust gender differences in preferences may often fail to translate into differential policy outcomes with increased female representation in policymaking.
    Keywords: Gender differences, risk, altruism, redistributive preferences, experiment
    JEL: C91 C92 J16 H23
    Date: 2017–11
  3. By: Francesco Fallucchi (University of East Anglia); R. Andrew Luccasen (Mississippi University for Women); Theodore L. Turocy (University of East Anglia)
    Abstract: We re-analyse participant behaviour in standard economics experiments studying voluntary contributions to a public good. Previous approaches were based in part on a priori models of decision-making, such as maximising personal earnings, or reciprocating the behaviour of others. Many participants however do not conform to one of these models exactly, requiring ad hoc adjustments to the theoretical baselines to identify them as belonging to a given behavioural type. We construct a typology of behaviour based on a similarity measure between strategies using hierarchical clustering analysis. We identify four clearly distinct behavioural types which together account for over 90% of participants in six experimental studies. The resulting type classification distinguishes behaviour across groups more consistently than previous approaches.
    Keywords: behavioural types, cluster analysis, cooperation, public goods
    JEL: C65 C71 H41
    Date: 2017–08–08
  4. By: David Hugh-Jones (University of East Anglia); Jinnie Ool (University of East Anglia)
    Abstract: People's preferences about the fair distribution of resources vary within and between different populations, and this affects many economic and political outcomes. We argue that a source of these differences is the social transmission of fairness norms from peers during adolescence. We ran an experiment on transmission of fairness norms in a friendship network of 11-15 year olds. Observing others' choices affects young people's fairness norms, as expressed in both their own choices and the attitudes they express. Our results show how young people can adopt redistributive norms via the social influence of their peer group. We also examine how the strength of social influence varies with friendship status and network position.
    Date: 2017–06–02
  5. By: Alessandro Gavazza; Mattia Nardotto; Tommaso M. Valletti
    Abstract: We empirically study the effects of broadband internet diffusion on local election outcomes and on local government policies using rich data from the U.K. Our analysis suggests that the internet has displaced other media with greater news content (i.e., radio and newspapers), thereby decreasing voter turnout, most notably among less-educated and younger individuals. In turn, we find suggestive evidence that local government expenditures and taxes are lower in areas with greater broadband diffusion, particularly expenditures targeted at less-educated voters. Our findings are consistent with the idea that voters’ information plays a key role in determining electoral participation, government policies and government size.
    JEL: D72
    Date: 2017
  6. By: Philipp Harms (Johannes Gutenberg-University Mainz, Germany); Claudia Landwehr (Johannes Gutenberg-University Mainz, Germany)
    Abstract: The call for more direct democracy is often and loudly heard and met with support from large numbers of citizens in many countries. This paper explores the motives for supporting direct democracy, and more specifically, referenda: Do citizens support them for intrinsic reasons, because referenda allow them exercise their democratic rights more directly? Or are preferences for referenda based on the assumption that they are likely to produce desired policy-outcomes, and thus instrumentally motivated? Our survey experiment explores how substantial policy preferences affect the preference for referenda over alternative decisionmaking procedures. Controlling for abstract support for referenda, we can show that congruence between a respondent’s own opinion and the expected majority opinion is associated with support for a referendum on a given matter. Moreover, we find evidence for systematic misperceptions of the majority opinion leading to support for a referendum. We thus arrive at the conclusion that calls for direct democracy should be reassessed in light of instrumental, but misinformed preferences.
    Keywords: democratic innovations, process preferences, direct democracy
    Date: 2017–10–27
  7. By: Shaun P. Hargeaves Heap (King's College London); Abhijit Ramalingam (University of East Anglia); Brock V. Stoddard (University of South Dakota)
    Abstract: This paper examines with an experiment a new way that inequality and competition may interact to affect productivity: through team public goods contributions. While inequality within a team diminishes team cooperation in the absence of competition, we find there is no effect of inequality when teams compete. Competition boosts cooperation and more so in unequal teams. Thus, a decline in competition accompanied by growing inequality has a doubly adverse effect on productivity. The difference in the effect of inequality is driven by the behaviour of the 'rich'. They disengage from their teams but recover their 'team spirit' under competition.
    Keywords: public goods, experiment, team competition, inequality, endowment, within-group
    JEL: C72 C91 C92 D31 D63 D72 H41
    Date: 2017–04–05
  8. By: Ahler, Douglas J. (FL State University); Broockman, David E. (Stanford University)
    Abstract: Many argue for political reforms intended to resolve apparent disjunctures between politicians' ideologically polarized policy positions and citizens less-polarized policy preferences. Here we show such apparent disjunctures can arise even when politicians represent their constituencies well, and that resolving them would likely degrade political representation. These counterintuitive results arise from a paradox whereby polarized politicians can best represent constituencies comprised of citizens with idiosyncratic preferences. We document this paradox among U.S. House Members, often criticized for excessive polarization. We show that if House Members represented their constituencies' preferences as closely as possible, they would still be polarized. Moreover, current Members nearly always represent their constituencies better than counterfactual less-polarized Members. A series of experiments confirms that even 'moderate' citizens often prefer polarized representatives to less-polarized alternatives.
    Date: 2017–04
  9. By: Morone, Andrea; Temerario, Tiziana; Nemore, Francesco
    Abstract: In this paper we investigated group size impact on risk aversion when a majority rule is applied. Drawing on the widely used Holt and Laury’s (2002) lottery pairs, we observed a risky shift for both individual and groups regardless of their size. However, groups choices are shown to be closer to the risk-neutrality prediction. More interestingly, whereas smaller groups attitudes can be safely approximated by individual choices, larger groups reveal a statistically different risk-loving attitude. This risky shift becomes more prominent as group size increases.
    Keywords: Preferences; Group; Risk Attitude; Majority Rule; Laboratory.
    JEL: C91 C92 D1
    Date: 2017–11
  10. By: Benoît Le Maux (CREM CNRS UMR6211, University Rennes 1 & Condorcet Center for Political Economy, France); Kristýna Dostálová (CREM CNRS UMR6211, University Rennes 1 & Condorcet Center for Political Economy, France); Fabio Padovano (CREM CNRS UMR6211, University Rennes 1 & Condorcet Center for Political Economy, France)
    Abstract: In the literature, there is a widespread consensus that left-wing governments raise taxes and public spending more than their right-wing counterparts. We demonstrate that this result must be interpreted with caution. What might seem a partisan effect, due to the direct impact of parties’ ideology on public spending, might actually be a selection bias, because changes in the distribution of voters’ preferences determine changes of the ideology of the government in office. We overcome this problem of observational equivalence by applying two identification strategies, regression discontinuity design and propensity score matching. Using data from the French local public sector, we show that left-wing governments facing the same economic situation as rightwing ones do not spend more, particularly in the case of social expenditures. This result rules out the partisan-politicians hypothesis and lends support to demand driven policy selection processes.
    Keywords: Public services, Party ideology, Redistribution, Partisan effects, Selection bias
    JEL: H72 H40 D72
    Date: 2017–10
  11. By: Mamoon, Dawood
    Abstract: The recent election results in US, Germany, Japan and China and vote for BRIXIT in Britian suggest that political outcomes increasingly relate to the economic, political and social orientation in both developed and developing countries. Countries that have not promoted social and economic harmony in the country - democracy eventually puts the pressure through the discontent local polity resulting in election outcomes similar to US presidential elections in 2016. To avoid anti-globalization feelings among local population and its negative outcomes, improving political orientation towards greater participation of local polity and investments in education in developing countries would result in more equality. The research is applicable to countries like India, China, Pakistan, Argentina, Sub-Saharan Africa who have all liberalised but still need to draw lessons from East Asia for their Industrialisation and Growth Promotion with early emphasis on Social and Institutional Development.
    Keywords: Democracy, Autocracy, Wage Inequality, International Trade
    JEL: F1 F12 F14 F15 F16 P1 P11 P16
    Date: 2017–11–08
  12. By: Stefania Sitzia (University of East Anglia); Jiwei Zheng (Universtiy of East Anglia)
    Abstract: This paper reports an experimental investigation where we compare groups and individual behavior on coordination games with payoff- irrelevant cues. We employ the disc game (Blume and Gneezy, 2010), the pie game (Crawford et al., 2008) and the bargaining table (Isoni et al., 2013). Our results show that groups choose more often according to the focal point cue than individuals when interests are aligned. Groups also perform better when identifying the focal point requires some level of cognition. In line with previous findings (Crawford et al., 2008; Isoni et al., 2013), when conflict of interest is introduced through payoff asymmetry, expected coordination rates fall for both groups and individuals, and they further decline as the payoff asymmetry increases. Additionally, groups' performance, unlike individuals' one, does not change across games, and this is due to groups using more effectively the focal cue to restrict their choices to only two strategies. Finally, groups that choose the not self-evident focal point tend to choose more often the focal point in the other games where instead it is easily identifiable.
    JEL: C72 C78 C91 C92
    Date: 2017

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