nep-cdm New Economics Papers
on Collective Decision-Making
Issue of 2020‒03‒16
fourteen papers chosen by
Stan C. Weeber, McNeese State University

  1. Governance and Group Conflict By Felix Koelle
  2. Refugee Migration and the Politics of Redistribution: Do Supply and Demand Meet? By Konstantinos Matakos; Riikka Savolainen; Janne Tukiainen
  3. Taxation with Representation: The Political Economy of Foreigners’ Voting Rights By Gonnot, Jérôme
  4. The Last will be First, and the First Last: Segregation in Societies with Relative Payoff Concerns By P. Jean-Jacques Herings; Riccardo D. Saulle; Christian Seel
  5. Economic Insecurity and the Rise of the Right By Walter Bossert; Andrew E. Clark; Conchita D'Ambrosio; Anthony Lepinteur
  6. External Threat, Group Identity, and Support for Common Policies - The Effect of the Russian Invasion in Ukraine on European Union Identity By Kai Gehring
  7. International Political Alignment during the Trump Presidency: Voting at the UN General Assembly By Martin Mosler; Niklas Potrafke
  8. Abstention by Loss-Averse Voters By Kohei Daido; Tomoya Tajika
  9. Dummy players and the quota in weighted voting games: Some further results By Fabrice Barthelemy; Mathieu Martin
  10. Gender, Information and the Efficiency of Household Production Decisions: An Experiment in Rural Togo By Apedo-Amah, Marie Christine; Djebbari, Habiba; Ziparo, Roberta
  11. The More The Better! Increasing Label Saliency as a way to Increase Coordination. An Experimental Investigation. By David Rojo-Arjona; R. Stefania Sitzia; Jiwei Zheng
  12. Votes For Women: An Economic Perspective on Women’s Enfranchisement By Carolyn Moehling; Melissa A. Thomasson
  13. Positive Spillovers from Negative Campaigning By Vincenzo Galasso; Tommaso Nannicini; Salvatore Nunnari
  14. Intelligence, Errors and Strategic Choices in the Repeated Prisoners' Dilemma By Proto, Eugenio; Rustichini, Aldo; Sofianos, Andis

  1. By: Felix Koelle (University of Cologne)
    Abstract: Many situations in the social and economic life are characterized by rivalry and conflict between two or more competing groups. Warfare, socio-political conflicts, political elections, lobbying, and R&D competitions are all examples of inter-group conflicts in which groups spend scarce and costly resources to gain an advantage over other groups. Here, we report on an experiment that investigates the impact of political institutions within groups on the development of conflict between groups. We find that relative to the case in which group members can decide individually on their level of conflict engagement, conflict significantly intensifies when investments are determined democratically by voting or when a single group member (the dictator) can decide on behalf of the group. These results hold for both symmetric and asymmetric contests, as well as for situations in which institutions are adopted exogenously or endogenously. Our findings thus suggest that giving people the possibility to vote is not the main reason for why democracies seem to engage in less wars than autocracies. Nevertheless, when giving participants the possibility to choose which institution to adopt, we find that the voting institution is the by far most popular one as it combines the desirable features of autonomy and equality
    Keywords: : Conflict, competition, institutions, democracy, groups, experiment
    Date: 2020–04
  2. By: Konstantinos Matakos (King’s College London); Riikka Savolainen (Newcastle University Business School); Janne Tukiainen (University of Turku)
    Abstract: We study whether establishing new asylum-seeker centres influences the redistribution related policy positions of candidates in local elections in Finland - a country where municipalities have significant control over fiscal policies. The sudden and unprecedentedly large inflow of the asylum seekers in autumn 2015 and the resulting establishment of asylum centres facilitates a difference-in-differences research design. We focus on the supply side of redistributive politics and find that on average candidates do not respond to the presence of the centres by proposing less (or more) redistribution in a voting aid application survey. Our estimates are precise enough to rule out even fairly small effects both for all the candidates and the elected ones. In contrast, on the demand side, there is evidence of various voter responses on average suggesting that electoral politics may limit to some extent the impact of voter preferences on such policies. However, in the very smallest municipalities where there are many refugees per capita we find that also the candidates become less favourable towards redistribution. In other words, intensity of exposure to refugee migration seems to be behind any observed supply-side response regarding redistribution.
    Keywords: candidates, immigration, local elections, redistribution, refugee crisis
    JEL: D72 H71 H72 J15
    Date: 2020–02
  3. By: Gonnot, Jérôme
    Abstract: This paper examines natives’ decision to grant political rights to foreign residents based on their contribution to a redistribution mechanism that finances a private and a public good. We propose a model where agents’ redistributive preferences are determined by their skill level and their cultural beliefs about public spending, which vary by skill and nationality. Contrary to a commonly held view in the political economy literature, we show that low-skill natives are willing to enfranchise relatively skilled foreigners as long as these foreigners have sufficiently liberal beliefs towards public spending. Moreover, we establish that the political rights that low-skill natives are prepared to grant to foreign residents is a nonmonotonic function of immigration’s skill level and cultural support for public expenditure. In particular, low-skill natives favor greater political integration for less-skilled or more liberal foreigners if and only if these foreigners’ average relative preferences for the private and the public good are sufficiently close to their own. We provide empirical support for some of the theoretical predictions of the model using an original municipality-level dataset of Swiss referenda about non-citizen voting rights. Our results indicate that municipalities where a higher share of natives received social transfers were more likely to support immigrant voting and that this effect was greater where foreigners were poorer and emigrated from less economically conservative countries.
    JEL: H41 H53 J68 D72
    Date: 2020–02
  4. By: P. Jean-Jacques Herings (Department of Economics, Maastricht University); Riccardo D. Saulle (DSEA, University of Padova); Christian Seel (Department of Economics, Maastricht University)
    Abstract: This paper studies coalition formation among individuals who differ in productivity. The output of a coalition is determined by the sum of the productivities and the size of the coalition. We consider egalitarian societies in which coalitions split their surplus equally and individualistic societies in which the surplus of a coalition is split according to productivity. Preferences of coalition members depend on their material payoffs, but are also influenced by relative payoff concerns, which relate their material payoffs to the average material payoff in the coalition. Our analysis uses two stability notions, the Core and the Myopic Stable Set. The stable partitions in both egalitarian and individualistic societies are segregated, i.e., individuals with adjacent productivities form coalitions. If some individuals are not part of a productive coalition, then these are the least productive ones for egalitarian societies and the most productive ones for individualistic societies. If all individuals have different productivity levels and there are sufficient complementarities in production, egalitarian societies induce more efficiency than individualistic societies.
    Keywords: Group Formation, Segregation, Relative Payoff, Egalitarianism, Meritocracy, Social Environment
    JEL: C70 C71 D62
    Date: 2020–03
  5. By: Walter Bossert (Department of Economics and CIREQ, University of Montreal); Andrew E. Clark (Paris School of Economics); Conchita D'Ambrosio (INSIDE, University of Luxembourg); Anthony Lepinteur (INSIDE, University of Luxembourg)
    Abstract: Economic insecurity has attracted growing attention in social, academic and policy circles. However, there is no consensus as to its precise definition. Intuitively, economic insecurity is multi-faceted, making any comprehensive formal definition that subsumes all possible aspects extremely challenging. We propose a simplified approach, and characterize a class of individual economic-insecurity measures that are based on the time profile of economic resources. We then apply our economic-insecurity measure to data on political preferences. In US, UK and German panel data, and conditional on current economic resources, economic insecurity is associated with both greater political participation (support for a party or the intention to vote) and notably more support for parties on the right of the political spectrum. We in particular find that economic insecurity predicts greater support for both Donald Trump before the 2016 US Presidential election and the UK leaving the European Union in the 2016 Brexit referendum.
    Keywords: Economic index numbers; Insecurity; Political participation; Conservatism; Right-leaning political parties; Trump; Brexit.
    JEL: D63 D72 I32
    Date: 2020–01
  6. By: Kai Gehring
    Abstract: A major theory from social psychology claims that external threats can strengthen group identities and cooperation. This paper exploits the Russian invasion in Ukraine 2014 as a sudden increase in the perceived military threat for eastern European Union member states, in particular for the Baltic countries bordering Russia directly. Comparing low versus high-threat member states in a difference-in-differences design, I find a sizeable positive effect on EU identity. It is associated with higher trust in EU institutions and support for common EU policies. Different perceptions of the invasion cause a polarization of preferences between the majority and ethnic Russian minorities.
    Keywords: external threats, group identity, nation-building, trust, fiscal federalism, European Union, EU identity, Russia, Ukraine, Baltic
    JEL: D70 F50 H70 N44 Z10
    Date: 2020
  7. By: Martin Mosler; Niklas Potrafke
    Abstract: We examine voting behavior of Western allied countries in line with the United States over the period 1949 until 2019. Descriptive statistics show that voting in line with the United States on resolutions in the United Nations General Assembly (UNGA) was on average 7.2 percentage points lower under Donald Trump than under the preceding United States presidents. The policy shift is especially pronounced for resolutions dealing with the Middle East. The decline in common UNGA voting behavior is significant for the resolution agreement rate and the absolute difference of ideal points. The results suggest that the alienation of Western allies is not driven by ideological distance based on a classical leftwing-rightwing government ideology scale.
    Keywords: Donald Trump, voting alignment, UNGA, political alliances
    JEL: F51 F53 D72 D78 C23
    Date: 2020
  8. By: Kohei Daido (School of Economics, Kwansei Gakuin University); Tomoya Tajika (Department of Law and Economics, Hokusei Gakuen University)
    Abstract: This paper builds a two-candidate election model, in which voters are loss averse and face uncertainty about whether their preferred candidate is supported by a majority. Even without costs for voting, abstention may occur when voters have expectations-based reference-dependent preferences, as in KÅ‘szegi and Rabin (2006, 2007). The model shows that loss aversion leads to the equilibrium in which abstention is more likely as an election becomes more competitive and the abstention rate of voters who prefer a minority candidate is higher than for those who prefer a majority candidate.
    Keywords: Abstention, Expectations-Based Reference-Dependent Preferences, Loss Aversion, Voting
    JEL: D72 D91
    Date: 2020–03
  9. By: Fabrice Barthelemy; Mathieu Martin (Université de Cergy-Pontoise, THEMA)
    Abstract: This paper is a companion paper of Barthelemy et al. (2019) which studies the role of the quota on the occurrence of "dummy" players in small weighted voting games (i.e., in voting games with 3, 4 or 5 players). We here extend the results obtained in this paper by considering voting games with a larger number of players (up to 15). It is shown that the probability of having a player without voting power is very sensitive to the choice of the quota and the quota values that minimize this probability are derived.
    Keywords: Cooperative game theory, weighted voting games, dummy player, probability of voting paradoxes.
    JEL: C7 D7
    Date: 2020
  10. By: Apedo-Amah, Marie Christine (Stanford University); Djebbari, Habiba (Aix-Marseille University); Ziparo, Roberta (Aix-Marseille University)
    Abstract: Why do farm households inefficiently allocate resources across the plots they cultivate? We explore how these production inefficiencies relate to consumption decisions and information sharing within the household. In a lab-in-the-field experiment, male producers allocate too few inputs to their wife's plot, failing to maximize household aggregate profits. They do transfer more inputs when the returns from that plot are higher. Experimental manipulation of information on these returns triggers heterogenous responses across households. We provide a theoretical framework that rationalizes these findings and further leads to sharp predictions. Joint contribution to a household public good compels spouses to make efficient production decisions. Only households who are in a separate-sphere regime experience inefficiency in farm production and are unable to effectively communicate on returns to avoid extra losses. Consistent with this framework, when we experimentally offer an ex post information verification mechanism, additional losses due to information asymmetries are prevented.
    Keywords: farm households, household production and intra-household allocation, non-cooperative game theory, asymmetric and private information, lab-in-the-field experiment
    JEL: Q12 C72 D13 D82 C91 C93
    Date: 2020–01
  11. By: David Rojo-Arjona (The George L Argyros School of Business and Economics, Chapman University.); R. Stefania Sitzia (School of Economics and Centre for Behavioural and Experimental Social Science, University of East Angle, Norwich.); Jiwei Zheng (School of Economics and Centre for Behavioural and Experimental Social Science, University of East Anglia, Norwich)
    Abstract: We report an experiment that investigates whether increasing the saliency of the focal point, increases coordination success in tacit coordination and bargaining games. We find unexpectedly high coordination rates not only when the degree of conflict is small but also when it is large. This provides supports to the conjecture that conflict of interests reduces the saliency of the focal point relative to saliency of the payoffs, and because of this, even small payoffs differences lead to significant mis-coordination. Increasing the saliency of the focal point has the effect of drawing attention away from the conflicting payoffs and towards the focal point, restoring its effectiveness as coordination devices. Increased saliency has also the effect of shifting choices from less to more unequal, and sometimes more efficient, outcomes. This results in greater coordination success on the outcome suggested by the payoff-irrelevant cue. Overall coordination success however does not increase.
    Keywords: Focal points; Coordination; Conflict of interest; Payoff-irrelevant cues.
    JEL: C78 C91
    Date: 2020–03
  12. By: Carolyn Moehling; Melissa A. Thomasson
    Abstract: The ratification of the Nineteenth Amendment in 1920 officially granted voting rights to women across the United States. However, many states extended full or partial suffrage to women before the federal amendment. In this paper, we discuss the history of women's enfranchisement using an economic lens. We examine the demand-side, discussing the rise of the women's movement and its alliances with other social movements, and describe how suffragists put pressure on legislators. On the supply side, we draw from theoretical models of suffrage extension to explain why men shared the right to vote with women. Finally, we review empirical studies that attempt to distinguish between competing explanations. We find that no single theory can explain women's suffrage in the US, and note that while the Nineteenth Amendment extended the franchise to women, state-level barriers to voting limited the ability of black women to exercise that right until the Voting Rights Act of 1965.
    JEL: N11 N12
    Date: 2020–02
  13. By: Vincenzo Galasso; Tommaso Nannicini; Salvatore Nunnari
    Abstract: Negative advertising is frequent in electoral campaigns, despite its ambiguous effectiveness: negativity may reduce voters’ evaluation of the targeted politician but have a backlash effect for the attacker. We study the effect of negative advertising in electoral races with more than two candidates with a large scale field experiment during an electoral campaign for mayor in Italy and a survey experiment in a fictitious mayoral campaign. In our field experiment, we find a strong, positive spillover effect on the third main candidate (neither the target nor the attacker). This effect is confirmed in our survey experiment, which creates a controlled environment with no ideological components nor strategic voting. The negative ad has no impact on the targeted incumbent, has a sizable backlash effect on the attacker, and largely benefits the idle candidate. The attacker is perceived as less cooperative, less likely to lead a successful government, and more ideologically extreme.
    Keywords: electoral campaign, political advertisement, randomized controlled trial, field experiment, survey experiment
    JEL: D72 C90 M37
    Date: 2020
  14. By: Proto, Eugenio (University of Glasgow); Rustichini, Aldo (University of Minnesota); Sofianos, Andis (Heidelberg University)
    Abstract: A large literature in behavioral economics has emphasized in the last decades the role of individual differences in social preferences (such as trust and altruism) and in influencing behavior in strategic environments. Here we emphasize the role of attention and working memory, and show that social interactions among heterogeneous groups are likely to be mediated by differences in cognitive skills. Our design uses a Repeated Prisoner's Dilemma, and we compare rates of cooperation in groups of subjects grouped according to their IQ, with those in combined groups. While in combined groups we observe higher cooperation rates and profits than in separated groups (with consistent gains among lower IQ subjects and relatively smaller losses for higher IQ subjects), higher IQ subjects become less lenient when they are matched with lower IQ subjects than when they play separately. We argue that this is an instance of a general phenomenon, which we demonstrate in an evolutionary game theory model, where higher IQ among subjects determines – through better working memory – a lower frequency of errors in strategy implementation. In our data, we show that players indeed choose less lenient strategies in environments where subjects have higher error rates. The estimations of errors and strategies from the experimental data are consistent with the hypothesis and the predictions of the model.
    Keywords: IQ, intelligence, cooperation, repeated Prisoner's Dilemma, strategy, error in transition
    JEL: C73 C91 C92
    Date: 2020–01

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