nep-cdm New Economics Papers
on Collective Decision-Making
Issue of 2021‒02‒22
three papers chosen by
Stan C. Weeber, McNeese State University

  1. Electoral Commitment in Asymmetric Tax-competition Models By Yukihiro Nishimura; Kimiko Terai
  2. Vote Delegation and Misbehavior By Hans Gersbach; Akaki Mamageishvili; Manvir Schneider
  3. The dynamics of cooperation, power, and inequality in a group-structured society By Tverskoi, Denis; Senthilnathan, Athmanathan; Gavrilets, Sergey

  1. By: Yukihiro Nishimura (Corresponding author. Graduate School of Economics, Osaka University); Kimiko Terai (Faculty of Economics, Keio University)
    Abstract: This study examines the political process of tax competition among asymmetric countries, highlighting the role of the commitment to the electoral promises. The median voters deliberately elect a delegate whose preferences di?er from their own (strategic delegation), which is self-enforcing under symmetric countries. We ?rst show that the outcome of strategic delegation is replicated when the candidates do not make binding campaign promises in both countries, and the opposite scenario of the binding commitments to the platforms leads to the self-representation by the median voters. We then amplify the model by adding the pre-election stage where the citizens choose whether the credibility of election promises is critical, through subscription numbers of newspapers and social media which determine the cost of betrayal of the proposed platforms (or the lack of the proposal). We then show that, depending on the type of asymmetries under consideration, su?cient asymmetry or su?ciently equal income distribution generate the commitment to the election campaign promises as the equilibrium outcome.
    Keywords: Capital-tax competition; Election campaign promises; Asymmetric countries; Voting
    JEL: C72 D72 D78 H23 H87
    Date: 2021–02
  2. By: Hans Gersbach; Akaki Mamageishvili; Manvir Schneider
    Abstract: We study vote delegation with "well-behaving" and "misbehaving" agents and compare it with conventional voting. Typical examples are validation or governance tasks on blockchains. There is a majority of well-behaving agents, but since voting is costly, they may want to abstain or delegate their vote to other agents. Misbehaving agents always vote. We compare conventional voting allowing for abstention with vote delegation. Preferences of voters are private information and a positive outcome is achieved if well-behaving voters win. We provide three insights: First, if the number of misbehaving voters, denoted by #X, is high, both voting methods fail to deliver a positive outcome. Second, if #X is moderate, conventional voting delivers a positive outcome, while vote delegation fails with probability one. Third, if #X is low, delegation delivers a positive outcome with a higher probability than conventional voting. Finally, our results allow us assessing the performance of vote delegation which is known as "liquid democracy".
    Date: 2021–02
  3. By: Tverskoi, Denis; Senthilnathan, Athmanathan; Gavrilets, Sergey
    Abstract: Most human societies are characterized by the presence of groups which cooperate through joint actions but also compete for resources and power. The processes of within- and between- group cooperation and competition have shaped human history over the last several millennia. To deepen our understanding of the underlying social dynamics, we model a society subdivided into groups with constant sizes and dynamically changing powers. Both individuals within groups and groups themselves participate in collective actions. The groups are also engaged in political contests over power which determines how resources are distributed. Using analytical approximations and agent-based simulations, we show that the model exhibits rich behavior characterized by multiple stable equilibria and, under some conditions, non-equilibrium dynamics. The strength of democratic institutions plays a key role: increasing it promotes cooperation, reduces variation in power, and mitigates inequality among groups. We show that increasing potential benefits of between-group cooperation promotes it only in societies with strong democratic institutions. We show that small groups are successful in competition if the jointly-produced goods are rivalrous and the potential benefit of cooperation is small. Otherwise large groups dominate. Overall our model contributes towards a better understanding of the causes of variation between societies in terms of the economic and political inequality within them.
    Date: 2021–02–08

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