nep-cdm New Economics Papers
on Collective Decision-Making
Issue of 2021‒02‒01
eighteen papers chosen by
Stan C. Weeber, McNeese State University

  1. Some regrettable grading scale effects under different versions of evaluative voting By Antoinette Baujard; Herrade Igersheim; Isabelle Lebon
  2. Negative votes to depolarize politics By Karthik H. Shankar
  3. Voting after a major flood: Is there a link between democratic experience and retrospective voting? By Neugart, Michael; Rode, Johannes
  4. Approval Voting & Majority Judgment in Weighted Representative Democracy By Arnold Cédrick SOH VOUTSA
  5. On the Existence of an Equilibrium in Models of Local Public Good Use by Cities to Attract the Creative Class By Batabyal, Amitrajeet; Beladi, Hamid
  6. Elections, Political Connections and Cash Holdings: Evidence from Local Assemblies By David Adeabah; Charles Andoh; Simplice A. Asongu; Isaac Akomea-Frimpong
  7. Games for triggering collective change in natural resource management: A conceptual framework and insights from four cases from India By Falk, Thomas; Zhang, Wei; Meinzen-Dick, Ruth Suseela; Bartels, Lara
  8. The Public Good spatial power index in political games By Arnold Cédrick SOH VOUTSA
  9. Value of agreement in decision analysis: Concept, measures and application By Tom Pape
  11. The Endogenous Formation of Common Pool Resource Coalitions By Carlos A. Chávez; James J. Murphy; Felipe J. Quezada; John K. Stranlund
  12. Selective sharing of news items and the political position of news outlets By Julian Freitag; Anna Kerkhof; Johannes Münster
  13. A Pairwise Strategic Network Formation Model with Group Heterogeneity: With an Application to International Travel By Tadao Hoshino
  14. Informal Central Bank Communication By Annette Vissing-Jorgensen
  15. Deegan-Packel & Johnston spatial power indices and characterizations By Arnold Cédrick SOH VOUTSA
  16. The Impact of Corona Populism: Empirical Evidence from Austria and Theory By Patrick Mellacher
  17. Britain has had enough of experts? Social networks and the Brexit referendum By Giacomo De Luca; Thilo R. Huning; Paulo Santos Monteiro
  18. When Distrust Goes Viral: Causal Effects of Covid-19 on European Political Attitudes By Gianmarco Daniele; Andrea F.M. Mfartinangeli; Francesco Passarelli; Willem Sas; Lisa Windsteiger

  1. By: Antoinette Baujard (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - CNRS - Centre National de la Recherche Scientifique - Université de Lyon - UJM - Université Jean Monnet [Saint-Étienne] - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - UL2 - Université Lumière - Lyon 2 - ENS Lyon - École normale supérieure - Lyon); Herrade Igersheim (BETA - Bureau d'Économie Théorique et Appliquée - UL - Université de Lorraine - UNISTRA - Université de Strasbourg - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Isabelle Lebon (CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR1 - Université de Rennes 1 - UNIV-RENNES - Université de Rennes - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Many voters seem to appreciate the greater freedom of expression afforded by alternative voting rules; in evaluative voting, for example, longer grading scales and/or negative grades seem desirable in so far as, all other things being equal, they allow greater expressivity. The paper studies to what extent the behavior of voters, and the outcomes of elections, are sensitive to the grading scale employed in evaluative (or "range") voting. To this end, we use voting data from an experiment conducted in parallel with the 2017 French presidential election,which aimed to scrutinize the negative grade effect and the length effect in grading scales. First, this paper confirms that the introduction of a negative grade disfavors "polarizing" candidates, those whose political discourse provokes divisive debate, but more generally we establish that it disfavors major candidates and favors minor candidates. Second, under non-negative scales, polarizing candidates may be relatively disfavored by longer scales, especially compared with candidates who attract only infrequent media coverage and who are little known among voters. Third, longer scales assign different weights to the votes of otherwise equal voters, depending on their propensity to vote strategically. Overall, we observe that the benefits of the expressivity provided by longer scales or negative grades need to be balanced against the controversial advantage these give to minor candidates, and their tendency to undermine the principle that each vote should count equally in the outcome of the election.
    Keywords: Evaluative Voting,Approval Voting,In Situ Experiment,Voting Scale Design,Behavioral Bias
    Date: 2020–11
  2. By: Karthik H. Shankar
    Abstract: The controversies around the 2020 US presidential elections certainly casts serious concerns on the efficiency of the current voting system in representing the people's will. Is the naive Plurality voting suitable in an extremely polarized political environment? Alternate voting schemes are gradually gaining public support, wherein the voters rank their choices instead of just voting for their first preference. However they do not capture certain crucial aspects of voter preferences like disapprovals and negativities against candidates. I argue that these unexpressed negativities are the predominant source of polarization in politics. I propose a voting scheme with an explicit expression of these negative preferences, so that we can simultaneously decipher the popularity as well as the polarity of each candidate. The winner is picked by an optimal tradeoff between the most popular and the least polarizing candidate. By penalizing the candidates for their polarization, we can discourage the divisive campaign rhetorics and pave way for potential third party candidates.
    Date: 2020–12
  3. By: Neugart, Michael; Rode, Johannes
    Abstract: We explore whether retrospective voting is related to voters' democratic experience. To this end, we compare the voting behavior in West Germany to the voting behavior in the formerly non-democratic East Germany after a disaster relief program addressing a flood in 2013. Our analysis reveals a 2.2 (or 0.9 percentage points) increase in the vote share for the incumbent party in the flooded municipalities in the East compared to the West. Analyzing an earlier flood, variation of democratic experience within East Germany, and a panel survey provides further evidence that less democratically experienced voters are easier prey to pre-election policies.
    Date: 2021
  4. By: Arnold Cédrick SOH VOUTSA (Université de Cergy-Pontoise, THEMA)
    Abstract: Pivato and Soh [Pivato, M., Soh, A., 2020.Weighted representative democracy. Journal of Mathematical Economics 88 (2020) 52-63] proposed a new system of democratic representation whereby any individual can choose any legislator as her representative and different legislators can represent different numbers of individuals, concomitantly determining their weights in the legislature. For such legislatures, we consider other voting rules, namely, the Weighted Approval Voting rule and Weighted Majority Judgment rule. We show that if the size of the electorate is large, then with very high probability, the decisions made by the legislature will be the same as the decisions that would have been reached by a direct democracy, as decided by the corresponding simple (unweighted) voting rules.
    Keywords: Social Choice, Ideal direct democracy, Representative democracy, Multioption decisions, Weighted Approval Voting, Weighted Majority Judgment
    JEL: D71 D72
    Date: 2020
  5. By: Batabyal, Amitrajeet; Beladi, Hamid
    Abstract: We analyze a stylized model of competition between two cities that use a local public good (LPG) to attract members of the creative class. The creative class consists of artists and engineers and we study the behavior of a representative artist and an engineer. The level of the LPG in each city is determined by majority voting of the two representative creative class members. If both representative members choose to live in the same city then the LPG provision is the average of the preferred quantities of the two members. In this setting, we perform three tasks. First, we ascertain the preferred quantity of the LPG for the representative artist and the engineer. Second, assuming that the representative artist and the engineer accurately predict the outcome of living in a particular city, we describe a scenario in which there is no equilibrium in our model. Finally, we show that if the representative artist and the engineer treat the LPG provision levels in each city as exogenous then an equilibrium does exist in the model.
    Keywords: Artist, Creative Class, Engineer, Equilibrium, Local Public Good
    JEL: H40 R11
    Date: 2021–01–03
  6. By: David Adeabah (Department of Finance, Legon, Ghana); Charles Andoh (Department of Finance, Legon, Ghana); Simplice A. Asongu (Yaoundé, Cameroon); Isaac Akomea-Frimpong (Western Sydney University, Australia)
    Abstract: We examine the relationship between elections, political connections, and cash holdings in Ghanaian local assemblies. Using a panel dataset of 179local assemblies over a period 2012 to 2017, a panel regression and the generalized method of moments estimation techniques was employed for the analysis. We find that local assemblies hold less cash during election years, which suggests that election may be one of the potential factors to mitigate agency conflict in weak governance environment. Further, we demonstrate that local assemblies that have political connections hold less cash; however, political uncertainty makes these entities conducive to agency problems than their non-connected peers because they hold more cash. Additional analysis indicates that one year prior to elections, managerial conservatism kicks-in and leads managers to hold more cash in local assemblies that have political connections, which continues and becomes more pronounced in election years. Our results have implications for regulations on the cash management practices of local assemblies.
    Keywords: agency problem; cash holdings; generalized method of moments;panel regression; political connections
    Date: 2021–01
  7. By: Falk, Thomas; Zhang, Wei; Meinzen-Dick, Ruth Suseela; Bartels, Lara
    Abstract: As resource users interact and impose externalities onto each other, institutions are needed to coordinate resource use, create trust, and provide incentives for sustainable management. Coordinated collective action can play a key role in enabling communities to manage natural resources more sustainably. But when such collective action is not present, what can be done to foster it? There is growing awareness that the governance of natural resources has to be adapted to the specific context. Interventions are often implemented at small scale, and the potential to scale up facilitation intensive approaches is limited. Moreover, sustainable resource management frequently fails to emerge or breaks down after the project ends. To date, researchers have typically used behavioral games to study cooperation patterns of communities. Recently, games have been adapted as learning and stakeholder engagement tools to improve management of the commons, strengthen self-regulation of resource use, and enhance constructive interactions among resource users. Combining games with other interventions and tools and facilitated discussions has been proposed as a promising approach to improve collective action institutions through experiential learning — a classic approach in education. This paper reviews existing literature and synthesizes lessons learned from a series of studies testing the use of behavioral games for institutional capacity development in India. We conclude that, while games alone will not be the solution to all natural resource management challenges games can provide a structured and therefore replicable approach for influencing behavior. They can also improve system understanding, raise awareness, influence norms, facilitate dialogue, train for crisis response, and increase legitimacy of decisions.
    Keywords: INDIA; SOUTH ASIA; ASIA; water; forests; behavioural changes; natural resources management; decision making; activities; impact assessment; facilitation tools; sustainable natural resource management; games
    Date: 2021
  8. By: Arnold Cédrick SOH VOUTSA (Université de Cergy-Pontoise, THEMA)
    Abstract: We propose a new spatial index called the Public Good spatial index, which is the spatial version of the standard Public Good index under independence behaviors (PGI). However, we show that the spatial model used, is not well suited for both, the standard Shapley Shubik index and the standard Public Good index under Ho- mogeneity behaviors (PGH); and consequently they do not have a consistent spatial version with respect to our model. By contrast, the same spatial model is appro- priated for the Banzhaf index and the aforementioned PGI index, concomitantly, allowing their spatial versions in political games. We also argue that those two well convenient spatial indices are only understandable under behavioral descriptions with independence assumptions on political issues. Finally, the paper details our findings by means of examples, comparisons, and it also provides relevant ways of computing spatial power indices in real case studies when it comes to lower dimensions.
    Keywords: political games, spatial power indices, Public Good index, Banzhaf index.
    JEL: C71 D71
    Date: 2021
  9. By: Tom Pape
    Abstract: In multi-criteria decision analysis workshops, participants often appraise the options individually before discussing the scoring as a group. The individual appraisals lead to score ranges within which the group then seeks the necessary agreement to identify their preferred option. Preference programming enables some options to be identified as dominated even before the group agrees on a precise scoring for them. Workshop participants usually face time pressure to make a decision. Decision support can be provided by flagging options for which further agreement on their scores seems particularly valuable. By valuable, we mean the opportunity to identify other options as dominated (using preference programming) without having their precise scores agreed beforehand. The present paper quantifies this Value of Agreement and extends the concept to portfolio decision analysis and criterion weights. The new concept is validated through a case study in recruitment.
    Date: 2020–12
  10. By: DeCaro, Daniel
    Abstract: This codebook provides concepts and methodologies for coding and quantifying the content and function of communication in group social dilemma experiments, specifically with a social and ecological component (e.g., common pool resource dilemma). The content that is coded pertains to such categories as small talk, humor, information exchange (e.g., ecological, social, institutional), enforcement (e.g., praise, warnings, threats), decision making (e.g., proposals, choosing). Functional categories pertain to key functions needed for group members to govern the dilemma: e.g., develop agreements, make group decisions (e.g., democratic decision making), resolve conflicts, and enforce compliance. This codebook provides guidance for metrics to associate coded communication content and function to observed cooperation.
    Date: 2021–01–13
  11. By: Carlos A. Chávez (Universidad de Talca); James J. Murphy (Department of Economics, University of Alaska Anchorage); Felipe J. Quezada (University of Massachusetts Amherst); John K. Stranlund (University of Massachusetts Amherst)
    Abstract: We develop a theoretical model of endogenous CPR coalition formation in which the resource is co-defended with costly monitoring by coalition members and sanctions for encroachment imposed by the government. We demonstrate that CPR coalitions can form even when monitoring is so costly that coalition members choose not to monitor for encroachment, but the coalitions will be relatively small. Larger coalitions will form if monitoring costs are low enough to yield effective deterrence. We tested the results of the model using lab-in-field experiments with fishers who were members of Chile’s territorial use rights fisheries (TURFs) and in the lab with Chilean university students. We find that fishers frequently formed CPR coalitions, even when they could not deter outsider poaching. Fishers usually formed the grand coalition when the monitoring cost was low, but they formed smaller coalitions when monitoring was more costly. Fishers invested in monitoring frequently and these investments reduced poaching. Relative to open access, when coalitions formed, total harvest effort was curtailed and earnings for coalition members generally increased. Students formed coalitions less frequently, these coalitions tended to be small, and they infrequently invested in monitoring, even when it was profitable to do so. Consequently, student coalition member earnings were not better off on average than under open access.
    Keywords: experimental economics, Common pool resources; enforcement; field experiments; poaching; territorial use rights fisheries; social dilemma; fisheries management; development economics; co-enforcement; coalition formation; encroachment
    JEL: C72 C90 C93 D70 K42 Q22 Q28 Q56 H40
    Date: 2021–01
  12. By: Julian Freitag; Anna Kerkhof (ifo Institute for Economic Research & LMU Munich); Johannes Münster (University of Cologne, Germany)
    Abstract: We present an easy to implement measure for the political position of news outlets based on politicians' selective sharing of news items. Politicians predominantly share news items that are in line with their political position, hence, one can infer the political position of news outlets from the politicians' revealed preferences over news items. We apply our measure to twelve major German media outlets by analyzing tweets of German Members of Parliament (MPs) on Twitter. For each news outlet under consideration, we compute the correlation between the political position of the seven parties in the 19th German Bundestag and their MPs' relative number of Twitter referrals to that outlet. We finnd that three outlets are positioned on the left, and two of them are positioned on the right. Several robustness checks support our results.
    Keywords: political media bias; political position; selective sharing; social media; Twitter
    JEL: H41 L82 L86 P16
    Date: 2021–01
  13. By: Tadao Hoshino
    Abstract: In this study, we consider a pairwise network formation model in which each dyad of agents strategically determines the link status between them. Our model allows the agents to have latent group heterogeneity in the propensity of link formation. For the model estimation, we propose a three-step maximum likelihood (ML) method. First, we obtain consistent estimates for the heterogeneity parameters at individual level using the ML estimator. Second, we estimate the latent group structure using the binary segmentation algorithm based on the results obtained from the first step. Finally, based on the estimated group membership, we re-execute the ML estimation. Under certain regularity conditions, we show that the proposed estimator is asymptotically unbiased and distributed as normal at the parametric rate. As an empirical illustration, we focus on the network data of international visa-free travels. The results indicate the presence of significant strategic complementarity and a certain level of degree heterogeneity in the network formation behavior.
    Date: 2020–12
  14. By: Annette Vissing-Jorgensen
    Abstract: Starting from a set of facts on the timing of stock returns relative to Federal Reserve decision-making, I argue that informal communication – including unattributed communication -- plays a central role in monetary policy communication. This contrasts with the standard communications framework in which communication should be public and on-the-record because it serves to ensure accountability and policy effectiveness. I lay out possible benefits of using unattributed communication as an institution, but these should be weighed against substantial costs: It runs counter to accountability to use unattributed communication, causes frustration among those trying to understand central bank intensions, and enables use of such communication by individual policymakers. Unattributed communication driven by policymaker disagreements is unambiguously welfare reducing, because it reduces policy flexibility and harms the central bank’s credibility and decision-making process. Central banks may benefit from resisting unattributed communication via expensive newsletters and increasing consensus-building efforts to reduce disagreement-driven unattributed communication.
    JEL: E5 G12
    Date: 2020–12
  15. By: Arnold Cédrick SOH VOUTSA (Université de Cergy-Pontoise, THEMA)
    Abstract: In this paper, we propose two spatial power indices in political games, taking into account ideological preferences of players. To do this, we develop an explanatory spatial model linked to the asymmetry Deegan-Pakel index introduced by Rapoport & Golan [Rapoport, A., Golan, E., 1985. Assessment of political power in the israeli knesset. American Political Science Review 79 (3), 673-692], which is the original Deegan-Packel index readjusted for measuring power according to the spatial preferences of players in real political games. In addition to extending such a readjustment for the original John- ston index | transforming it concomitantly into the Johnston spatial power index | this paper presents both the general versions of these two spatial indices, and their axiomatic characterizations through new axioms such as the vetoer property and others mainly in- spired from Lorenzo-Freire et al. [Lorenzo-Freire, S., Alonso-Meijide, J. M., Casas-Mendez, B., Fiestras-Janeiro, M. G., 2007. Characterizations of the Deegan-Packel and johnston power indices. European Journal of Operational Research 177 (1), 431-444].
    Keywords: Game theory, Spatial voting games, Deegan-Packel spatial power index, Johnston spatial power index, Axiomatic characterizations, Political games.
    JEL: C71 D71
    Date: 2020
  16. By: Patrick Mellacher
    Abstract: I study the impact of corona populism -- politics aimed at denying or downplaying the danger posed by COVID-19 for strategic reasons -- on the evolution of the pandemic using regional data from Austria. The right-wing FPOE first vocalized strong support for strict lockdown measures, but made a corona populist turn at the end of the first wave of infections. Using regression analysis, I show that the vote share of the FPOE at the last national parliamentary elections is a strong predictor for the number of COVID-19 deaths after the FPOE switched their policy stance, while there is no or even a negative correlation before the policy switch. These results are robust under simple as well as sophisticated specifications of the model controlling for demographic and socioeconomic conditions. Interestingly, I do not find a statistically significant correlation between the FPOE vote share and the reported number of infections. I hypothesize that this can be traced back to a self-selection bias in testing. To explore this hypothesis, I extend the classical SIRD model to incorporate conditional quarantine and two groups of agents: the majority and the corona sceptics, where the latter are less inclined to get tested and engage in social distancing. Such a model can explain the nontrivial empirics: if mixing is sufficiently homophilic, an increase in the share of corona sceptics can cause an increase in the number of deaths without increasing the number of reported infections. I finally discuss the implications for both groups.
    Date: 2020–12
  17. By: Giacomo De Luca; Thilo R. Huning; Paulo Santos Monteiro
    Abstract: We investigate the impact of social media on the 2016 referendum on the United Kingdom membership of the European Union. We leverage 18 million geo-located Twitter messages originating from the UK in the weeks before the referendum. Using electoral wards as unit of observation, we explore how exogenous variation in Twitter exposure affected the vote share in favor of leaving the EU. Our estimates suggest that in electoral wards less exposed to Twitter the percentage who voted to leave the EU was greater. This is confirmed across several specifications and approaches, including two very different IV identification strategies to address the non-randomness of Twitter usage. To interpret our findings, we propose a model of how bounded rational voters learn in social media networks vulnerable to fake news, and we validate the theoretical framework by estimating how Remain and Leave tweets propagated differently on Twitter in the two months leading to the EU referendum.
    Keywords: Fake News, Social Networks, Social Media, Brexit
    JEL: D72 D83 L82 L86
    Date: 2021–01
  18. By: Gianmarco Daniele; Andrea F.M. Mfartinangeli; Francesco Passarelli; Willem Sas; Lisa Windsteiger
    Abstract: To investigate how Covid-19 is shaping the way Europeans think about institutions, we conducted a large online survey experiment during the first wave of the epidemic (June). With a randomised survey ow we varied whether respondents are given Covid-related treatment questions first, before answering the outcome questions. We find that the crisis has severely undermined trust in politicians, the media, the EU and social welfare spending financed by taxes. This is mainly due to economic insecurity, but also because of health concerns. We also uncover a rallying effect around (scientific) expertise combined with populist policies losing ground.
    Keywords: Covid-19, institutional trust, political attitudes, online survey experiment, European Union, welfare, taxation, populism
    JEL: D72 H51 H53 H55 O52 P52
    Date: 2020

This nep-cdm issue is ©2021 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.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.