nep-cdm New Economics Papers
on Collective Decision-Making
Issue of 2019‒11‒04
fifteen papers chosen by
Stan C. Weeber, McNeese State University

  1. MMP-elections and the assembly size By Stensholt, Eivind
  2. More Federal Legislators Lead to More Resources for Their Constituencies: Evidence from Exogenous Differences in Seat Allocations By Marco Franka; David Stadelmann
  3. Winning Coalitions in Plurality Voting Democracies By René van den Brink; Dinko Dimitrov; Agnieszka Rusinowska
  4. Electoral Competition with Fake News By Gene M. Grossman; Elhanan Helpman
  5. Coalition-structured governance improves cooperation to provide public goods By V\'itor V. Vasconcelos; Phillip M. Hannam; Simon A. Levin; Jorge M. Pacheco
  6. Building social networks under consent: A survey By Robert P. Gilles
  7. The Politics of News Personalization By Lin Hu; Anqi Li; Ilya Segal
  8. I like, therefore I am. Predictive modeling to gain insights in political preference in a multi-party system By PRAET, Stiene; VAN AELST, Peter; MARTENS, David
  9. Challenging conventional wisdom: Experimental evidence on heterogeneity and coordination in avoiding a collective catastrophic event By Waichman, Israel; Requate, Tilman; Karde, Markus; Milinski, Manfred
  10. Social polarisation at the local level: a four-town comparative study By Koch, Insa; Fransham, Mark James; Cant, Sarah; Ebrey, Jill; Glucksberg, Luna; Savage, Mike
  11. Costly Verification in Collective Decisions By Albin Erlanson; Andreas Kleiner
  12. The interplay of ideas, institutional innovations and organisational structures: Insights from group farming in India By Bina Agarwal
  13. Partisan Bias in Inflation Expectations By Oliver Bachmann; Klaus Gründler; Niklas Potrafke; Ruben Seiberlich
  14. Political Affections on Online Social Network: The Opinative Priority During the Presidential Campaigns By Aloha Boeck
  15. Workers' Voice: Workers' Voice in European corporate governance - an invitation to open up new perspectives for participatory democracy By Kluge, Norbert; Leger, Robin; Leuchters, Maxi

  1. By: Stensholt, Eivind (Dept. of Business and Management Science, Norwegian School of Economics)
    Abstract: MMP (Mixed Member Proportional) elections for legislatures have ballots with one vote in a local single seat tally and one vote for a party list in a multi-seat tally. In Germany, the multi-seat tally occasionally violated a Participation axiom. The federal Constitutional Court declared this unconstitutional in 2008. Rules were changed. In 2017, the result was a Bundestag with 709 members, 111 of them in extra-ordinary party seats. The paper considers two remedies against excessive assembly size. One is “faithful accounting” of ballot data in each local tally, another a change from Plurality to a Majority method. For this use, we consider IRV, i.e. Instant Runoff Voting, in combination with a 3-candidate Condorcet method. The mayoral IRV election in Burlington 2009 serves as an example, here in the special context of MMP. Violations of the Participation criterion occur also in the usual Majority methods for single seat elections. The legal adoption of a mathematical axiom from election theory have consequences seen in the context of established impossibility theorems.
    Keywords: Mixed Member Proportional; Instant Runoff Voting; Participation criterion; legality; legitimacy; Burlington election 2009
    JEL: D72
    Date: 2019–10–30
  2. By: Marco Franka; David Stadelmann
    Abstract: Electoral district magnitude varies across German electoral constituencies and over legislative periods due to Germany’s electoral system. The number of seats in parliament per constituency is effectively random. This setting permits us to investigate exogenous variations in district magnitude on federal resource allocation. We analyse the effect of having more than one federal legislator per constituency on federal government resources by exploiting information from 1,375 German constituencies from 1998 to 2017. More federal legislators per constituency lead to statistically significantly more employment of federal civil servants in the respective constituencies. The size of the effect corresponds to about 37 additional federal civil servants (3.4% of average employment) once a constituency is represented by additional legislators from party lists. Numerous robustness tests support our results. Further evidence points to some heterogeneity of the effect. In particular, constituencies represented by additional legislators who are experienced and who are members of larger, competing parties obtain more federal resources.
    Keywords: District magnitude; political processes; redistribution mixed- member system
    JEL: D72 F50 H41
    Date: 2019–10
  3. By: René van den Brink (Department of Econometrics and Tinbergen Institute, VU University Amsterdam); Dinko Dimitrov (Chair of Economic Theory - Saarland University); Agnieszka Rusinowska (Centre d'Economie de la Sorbonne, PSE-CNRS, Université Paris 1)
    Abstract: We study the issue of assigning weights to players that identify winning coalitions in plurality voting democracies. For this, we consider plurality games which are simple games in partition function form such that in every partition there is at least one winning coalition. Such a game is said to be precisely supportive if it possible to assign weights to players in such a way that a coalition being winning in a partition implies that the combined weight of its members is maximal over all coalitions in the partition. A plurality game is decisive if in every partition there is exactly one winning coalition. We show that decisive plurality games with at most four players, majority games with an arbitrary number of players, and almost symmetric decisive plurality games with an arbitrary number of players are precisely supportive. Complete characterizations of a partition's winning coalitions are provided as well
    Keywords: plurality game; plurality voting; precise support; simple game in partition function form; winning coalition
    JEL: C71 D62 D72
    Date: 2019–07
  4. By: Gene M. Grossman; Elhanan Helpman
    Abstract: Misinformation pervades political competition. We introduce opportunities for political candidates and their media supporters to spread fake news about the policy environment and perhaps about parties' positions into a familiar model of electoral competition. In the baseline model with full information, the parties' positions converge to those that maximize aggregate welfare. When parties can broadcast fake news to audiences that disproportionately include their partisans, policy divergence and suboptimal outcomes can result. We study a sequence of models that impose progressively tighter constraints on false reporting and characterize situations that lead to divergence and a polarized electorate.
    JEL: D72 D78
    Date: 2019–10
  5. By: V\'itor V. Vasconcelos; Phillip M. Hannam; Simon A. Levin; Jorge M. Pacheco
    Abstract: While the benefits of common and public goods are shared, they tend to be scarce when contributions are provided voluntarily. Failure to cooperate in the provision or preservation of these goods is fundamental to sustainability challenges, ranging from local fisheries to global climate change. In the real world, such cooperative dilemmas occur in multiple interactions with complex strategic interests and frequently without full information. We argue that voluntary cooperation enabled across multiple coalitions (akin to polycentricity) not only facilitates greater generation of non-excludable public goods, but may also allow evolution toward a more cooperative, stable, and inclusive approach to governance. Contrary to any previous study, we show that these merits of multi-coalition governance are far more general than the singular examples occurring in the literature, and are robust under diverse conditions of excludability, congestability of the non-excludable public good, and arbitrary shapes of the return-to-contribution function. We first confirm the intuition that a single coalition without enforcement and with players pursuing their self-interest without knowledge of returns to contribution is prone to cooperative failure. Next, we demonstrate that the same pessimistic model but with a multi-coalition structure of governance experiences relatively higher cooperation by enabling recognition of marginal gains of cooperation in the game at stake. In the absence of enforcement, public-goods regimes that evolve through a proliferation of voluntary cooperative forums can maintain and increase cooperation more successfully than singular, inclusive regimes.
    Date: 2019–10
  6. By: Robert P. Gilles
    Abstract: This survey explores the literature on game-theoretic models of network formation under the hypothesis of mutual consent in link formation. The introduction of consent in link formation imposes a coordination problem in the network formation process. This survey explores the conclusions from this theory and the various methodologies to avoid the main pitfalls. The main insight originates from Myerson's work on mutual consent in link formation and his main conclusion that the empty network (the network without any links) always emerges as a strong Nash equilibrium in any game-theoretic model of network formation under mutual consent and positive link formation costs. Jackson and Wolinsky introduced a cooperative framework to avoid this main pitfall. They devised the notion of a pairwise stable network to arrive at equilibrium networks that are mainly non-trivial. Unfortunately, this notion of pairwise stability requires coordinated action by pairs of decision makers in link formation. I survey the possible solutions in a purely non-cooperative framework of network formation under mutual consent by exploring potential refinements of the standard Nash equilibrium concept to explain the emergence of non-trivial networks. This includes the notions of unilateral and monadic stability. The first one is founded on advanced rational reasoning of individuals about how others would respond to one's efforts to modify the network. The latter incorporates trusting, boundedly rational behaviour into the network formation process. The survey is concluded with an initial exploration of external correlation devices as an alternative framework to address mutual consent in network formation.
    Date: 2019–10
  7. By: Lin Hu; Anqi Li; Ilya Segal
    Abstract: We study how news personalization affects policy polarization. In a two-candidate electoral competition model, an attention-maximizing infomediary aggregates information about candidate valence into news, whereas voters decide whether to consume news, trading off the expected utility gain from improved expressive voting against the attention cost. Broadcast news attracts a broad audience by offering a symmetric signal. Personalized news serves extreme voters with skewed signals featuring own-party bias and occasional big surprise. Rational news aggregation yields policy polarization even if candidates are office-motivated. Personalization makes extreme voters the disciplining entity for equilibrium polarization and increases polarization through occasional big surprise.
    Date: 2019–10
  8. By: PRAET, Stiene; VAN AELST, Peter; MARTENS, David
    Abstract: In political sciences there is a long tradition of trying to understand party preferences and voting behavior to explain political decisions. Traditionally, scholars relied on voting histories, religious affiliation, and socio-economic status to understand people’s vote. Today, thanks to the Internet and social media, an unseen amount and granularity of data is available. In this paper we show how political insights can be gained from high-dimensional and sparse Facebook data, by building and interpreting predictive models based on Facebook ‘like’ and survey data of more than 6.500 Flemish participants. First, we built several logistic regression models to show that it is possible to predict political leaning and party preference based on Facebook likes in a multi-party system, even when excluding the political Facebook likes. Secondly, by introducing several metrics that measure the association between Facebook likes and a certain political affiliation, we can describe voter profiles in terms of common interests. For example, left voters often like environmental organizations and alternative rock music, whereas right voters like Flemish nationalistic content and techno music. Lastly, we develop a method to measure ideological homogeneity, or to what extent do people that like the same products, movies, books, etc. have a similar political ideology. In the Flemish setting, the categories ‘politics’ and ‘civil society’ are most ideologically homogeneous whereas ‘TV shows’ and ‘sports’ are the most heterogeneous. The results show that our approach has the potential to help political scientists to gain insights into voter profiles and ideological homogeneity using Facebook likes.
    Date: 2018–12
  9. By: Waichman, Israel; Requate, Tilman; Karde, Markus; Milinski, Manfred
    Abstract: Avoiding a catastrophic climate change event is a global public good characterized by several dimensions, notably heterogeneity between the parties involved. It is often argued that such heterogeneity between countries is a major obstacle to cooperative climate policy. We challenge this belief by experimentally simulating two important heterogeneities, in wealth and loss, when dangerous climate change occurs. We find that under loss heterogeneity the success rate in achieving sufficient mitigation to prevent catastrophic climate change is higher than with homogeneous parties. We also observe that neither endowment heterogeneity nor the combination of endowment and loss heterogeneities lead to significantly different success rates than with homogeneous parties. Our findings suggest that heterogeneities may facilitate rather than hinder successful international climate policy negotiations.
    Keywords: global public good,change negotiation,collective-risk social dilemma,endowmentheterogeneity,loss heterogeneity,focal point
    JEL: C92 D74 H41 Q54
    Date: 2019
  10. By: Koch, Insa; Fransham, Mark James; Cant, Sarah; Ebrey, Jill; Glucksberg, Luna; Savage, Mike
    Abstract: The concept of polarisation, where the extremes of a distribution are growing and where there is a missing or shrinking ‘middle’, has attracted recent interest driven by concerns about the consequences of inequality in British society. This paper brings together evidence of economic, spatial and relational polarisation across four contrasting towns in the United Kingdom: Oldham, Margate, Oxford and Tunbridge Wells. Deploying a comparative community analysis, buttressed by quantitative framing, we demonstrate the need to recognise how local social processes vary amongst places that on the face of it display similar trends. We show how local polarisation plays out differently depending on whether it is driven ‘from above’ or ‘from below’. Across all four towns, we draw out how a ‘missing middle’ of intermediaries who might be able to play roles in cementing local relations poses a major challenge for political mobilisation in times of inequality
    Keywords: community studies; inequality; polarisation; segregation
    JEL: R00 P50
    Date: 2019–10
  11. By: Albin Erlanson; Andreas Kleiner
    Abstract: We study how a principal should optimally choose between implementing a new policy and maintaining the status quo when information relevant for the decision is privately held by agents. Agents are strategic in revealing their information and we exclude monetary transfers, but the principal can verify an agent's information at a cost. We characterize the mechanism that maximizes the expected utility of the principal. This mechanism can be implemented as a cardinal voting rule, in which agents can either cast a baseline vote, indicating only whether they are in favor of the new policy, or they make specific claims about their type. The principal gives more weight to specific claims and verifies a claim whenever it is decisive.
    Date: 2019–10
  12. By: Bina Agarwal
    Abstract: An innovative development programme requires ideas at multiple stages, from conception to implementation. Where do these ideas come from, and how do they shape institutional and organisational structures? A recent debate on ideas has focused more on their role in framing public policy, than on their role in designing institutions or the organisational structures needed for the successful functioning of those institutions. Moreover, this debate mostly concerns political institutions in developed countries, and ideas mooted by experts. In contrast, a much older body of work on participatory development emphasises the need for planners to design policy in interaction with local communities, taking account of ideas emerging from ordinary people whom the policies will affect. But what kinds of organisational forms can enable villager participation in policy formulation and ensure the creation of viable institutions? This paper analyses the interplay between ideas, institutions, and organisational structures, using, as an example, an unusual institutional innovation, namely group farming by women in two states of India – Telangana and Kerala. Based especially on the author’s interviews with those who shaped and implemented these programmes in each state, it traces how the idea of group farming for poverty alleviation and women’s empowerment emerged; how it differed from the historical examples of collective farming globally; and the thinking behind different elements of programme implementation. Although both states focused on group farming, they diverged notably in their ideas about group formation and composition, and the organisational form needed for implementation. The paper traces these differences, and their effect on the economic and social performance of the groups, as well as on institutional sustainability.
    Date: 2019
  13. By: Oliver Bachmann; Klaus Gründler; Niklas Potrafke; Ruben Seiberlich
    Abstract: We examine partisan bias in inflation expectations. Our dataset includes inflation expectations of the New York Fed’s Survey of Consumer Expectations over the period June 2013 to June 2018. The results show that inflation expectations were 0.46 per centage points higher in Republican-dominated than in Democratic-dominated US states when Barack Obama was US president. Compared to inflation expectations in Democratic-dominated states, inflation expectations in Republican-dominated states declined by 0.73 percentage points when Donald Trump became president. We employ the Blinder-Oaxaca decomposition method to disentangle the extent to which political ideology and other individual characteristics predict inflation expectations: around 25% of the total difference between inflation expectations in Democratic-dominated versus Republican-dominated states is based on how partisans respond to changes in the White House’s occupant (partisan bias). The results also corroborate the belief that voters’ misperceptions of economic conditions decline when the president belongs to the party that voters support.
    JEL: C13 D72 E31 P44
    Date: 2019
  14. By: Aloha Boeck (The Lutheran University of Brazil, Canoas, Brazil)
    Abstract: How does the urgency on publicizing opinions was expressed in the uses of an online social network during a conflicted period of time like the Presidential Campaign in countries such as Brazil and United States? In these scenarios, it seems that it is not enough to simply reflect on certain relevant topics; it seems essential to externalize opinions that seek to establish an intransigent position. To understand this phenomenon, possible evidence can be found in the way communities of fans are organized, guided by the regulation of affections in the media and in education. Thus, the concept of "opinionative priority" is proposed to understand the disputes about the meaning of democracy that emerge in online social networks, being the attempt to corroborate, counter or refute a statement, in a power dispute. It is the tensioning itself resulting from the need to belong, caused by social networks, and participatory culture, because it is not enough to be and be seen, it is necessary to be part of the discussions, or to initiate a new one. These disputes treat diverse opinions as enemies to be exterminated, obliterating the pluralistic democratic condition, supported by the fundamental right of freedom of speech. Therefore, it is understood that the "opinionative priority" is more than a communication process, since it promotes a pedagogical action in which opinion is formed from absence of moderation, once there is no time for considerations; there is only the urgency to defend a point of view in social networks.
    Keywords: opinion; online social network; community of fans; democracy, affect
    Date: 2019–08
  15. By: Kluge, Norbert; Leger, Robin; Leuchters, Maxi
    Abstract: Mitbestimmungsreport No. 52 summarises the results of the Böckler group of experts' "Workers' Voice" and shows that various forms of the Workers' Voice are distributed in Europe - as functional equivalents with similar features and objectives: representing workers' interests, protecting and enforcing workers' rights, and being proactively involved in management decisions. To enable Workers' Voice to play a major role for a social Europe, the EU must revise the European legal framework and strengthen good corporate governance. This includes enshrining co-determination in supervisory and management boards of multinationals in a legally binding way, protecting existing rights to participate on a national level, and stipulating minimum standards for information, consultation and co-determination.
    Date: 2019

This nep-cdm issue is ©2019 by Stan C. Weeber. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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