nep-cdm New Economics Papers
on Collective Decision-Making
Issue of 2021‒03‒15
twelve papers chosen by
Stan C. Weeber, McNeese State University

  1. By Chance or by Choice? Biased Attribution of Others'Outcomes when Social Preferences Matter By Nisvan Erkal; Lata Gangadharan; Boon Han Koh
  2. The Political Economy of the Prussian Three-class Franchise By Sascha O. Becker; Erik Hornung
  3. Are some people more equal than others? Experimental evidence on group identity and income inequality By Lustenhouwer, Joep; Makarewicz, Tomasz; Peña, Juan Carlos; Proaño Acosta, Christian
  4. Fuelling the (party) machine: The political origins of the Greek debt during Metapolitefsi By Pantelis Kammas; Maria Poulima; Vassilis Sarantides
  5. Individual versus Group Choices of Repeated Game Strategies: A Strategy Method Approach By Timothy N. Cason; Vai-Lam Mui
  6. Humanistic digital governance By Snower, Dennis J.; Twomey, Paul
  7. Engagement to Action: Improving Policy Outcomes Through Better Consultation By Kate Nelischer
  8. Age, Inequality and the Public Provision of Healthcare By Anirban Mitra
  9. The Refugee Crisis and Right-Wing Populism: Evidence from the Italian Dispersal Policy By Campo, Francesco; Giunti, Sara; Mendola, Mariapia
  10. Homo moralis goes to the voting booth: a new theory of voter turnout By Alger, Ingela; Laslier, Jean-François
  11. Third-Party Punishment: Retribution or Deterrence? By Fangfang Tan; Erte Xiao
  12. Profiling Insurrection: Characterizing Collective Action Using Mobile Device Data By David Van Dijcke; Austin L. Wright

  1. By: Nisvan Erkal (University of Melbourne); Lata Gangadharan (Monash University); Boon Han Koh (University of East Anglia)
    Abstract: Decision makers in positions of power often make unobserved choices under risk and uncertainty. In many cases, they face a trade-o between maximizing their own payoff and those of other individuals. What inferences are made in such instances about their choices when only outcomes are observable? We report fndings from two experiments that investigate whether outcomes are attributed to luck or choices. We show that attribution biases exist in the evaluation of good outcomes. On average, good outcomes of decision makers are attributed more to luck as compared to bad outcomes. This asymmetry implies that decision makers get too little credit for their successes. Interestingly, the biases are exhibited by those individuals who make or would make the less prosocial choice for the group as decision makers, suggesting that a consensus effect may be shaping both the belief formation and updating processes.
    Keywords: Decision-making under risk; Beliefs about others' decisions; Attribution biases; Social preferences; Consensus e ect; Experiments
    JEL: C92 D91 D81
    Date: 2021–03–11
  2. By: Sascha O. Becker; Erik Hornung
    Abstract: Did the Prussian three-class franchise, which politically over-represented the economic elite, affect policy-making? Combining MP-level political orientation, derived from all roll call votes in the Prussian parliament (1867–1903), with constituency characteristics, we analyze how local vote inequality, determined by tax payments, affected policy-making during Prussia’s period of rapid industrialization. Contrary to the predomi-nant view that the franchise system produced a conservative parliament, higher vote inequality is associated with more liberal voting, especially in regions with large-scale industry. We argue that industrialists preferred self-serving liberal policies and were able to coordinate on suitable MPs when vote inequality was high.
    JEL: D72 N43 N93 P26
    Date: 2019–06
  3. By: Lustenhouwer, Joep; Makarewicz, Tomasz; Peña, Juan Carlos; Proaño Acosta, Christian
    Abstract: We investigate the effects of group identity and income inequality on social preferences and polarization by means of a laboratory experiment. We split our subjects into two populations: in-group (representing "natives") and out-group ("migrants"). In-group subjects repeatedly vote whether an unemployment insurance should cover all, some, or no members of their group. By means of a two-by-two design we disentangle the effect of group identity from those of income inequality. Among others, our experiment yields the following findings: (1) subjects tend to vote for less inclusive insurance schemes when they sample a higher chance of employment; however, (2) in-group subjects with an ex ante more beneficial distribution of employment chances - relative to the out-group - are less selfish and vote for more inclusive insurance schemes; (3) ex ante more beneficial relative employment chances of in-group subjects also leads to less polarization; and (4) revelation and priming of group identity does not lead to discrimination against out-group "migrants" but, on the contrary, can lead to more compassionate and inclusive attitudes.
    Keywords: Income Inequality,Political Polarization,Migration,Economic Voting Behavior,Group Identity
    JEL: C92 D72 J15
    Date: 2021
  4. By: Pantelis Kammas (Athens University of Economics and Business.); Maria Poulima (Department of Economics, University of Ioannina, Greece); Vassilis Sarantides (Department of Economics, University of Sheffield, UK)
    Abstract: The present paper investigates the possibility of political economy incentives behind the allocation of the markedly expanded fiscal account of intergovernmental transfers to prefectures and municipalities during Metapolitefsi – i.e., the period after the establishment of the Third Hellenic Republic (1974 to 1993). Building on a novel dataset of expenses to prefectures and subsidies to municipalities, we employ a Difference-in-Differences framework and a Regression Discontinuity Design respectively. Our analysis suggests that incumbent parties diverted prefectural expenses towards their political strongholds, and subsidies to politically aligned mayors. We argue that the expansion of intergovernmental transfers which contributed significantly to the derailment of the Greek state resulted from the transformation of the political system from traditional patron-client relationships to bureaucratic clientelism. On this basis, appointed prefects and politically aligned mayors became major components of a centralized party machine to mobilize voters through mass memberships “at the level of the town and the village” in the new era of Metapolitefsi.
    Keywords: intergovernmental transfers; clientelistic networks; party machine
    JEL: H1 H4 D7
    Date: 2021–02
  5. By: Timothy N. Cason; Vai-Lam Mui
    Abstract: We study experimentally the indefinitely repeated noisy prisoner’s dilemma, in which random events can change an intended action to its opposite. We investigate whether groups choose Always Defect less and use lenient or forgiving strategies more than individuals, and how decision-makers experiment with different strategies by letting them choose from an extensive list of repeated game strategies. We find that groups use forgiving and tit-for-tat strategies more than individuals. Always Defect, however, is the most popular strategy for both groups and individuals. Groups and individuals cooperate at similar rates overall, and they seldom experiment with different strategies in later supergames.
    Keywords: Laboratory Experiment; Cooperation; Repeated Games; Strategy
    JEL: C73 C92
    Date: 2019–06
  6. By: Snower, Dennis J.; Twomey, Paul
    Abstract: We identify an important feature of current digital governance systems: "third-party funded digital barter": consumers of digital services get many digital services for free (or under- priced) and in return have personal information about themselves collected for free. In addition, the digital consumers receive advertising and other forms of influence from the third parties that fund the digital services. The interests of the third-party funders are not well-aligned with the interests of the digital consumers. This fundamental flaw of current digital governance systems is responsible for an array of serious problems, including inequities, inefficiencies, manipulation of digital consumers, as well as dangers to social cohesion and democracy. We present four policy guidelines that aim to correct this flaw by shifting control of personal data from the data aggregators and their third-party funders to the digital consumers. The proposals cover "official data" that require official authentication, "privy data" that is either generated by the data subjects about themselves or by a second parties, and "collective data." The proposals put each of these data types under the individual or collective control of the data subjects. There are also proposals to mitigate asymmetries of information and market power.
    Keywords: Digital governance,digital services,personal data,digital service providers,market power,advertising,preference manipulation
    JEL: O33 P34 O35 O36 O38 H41 L41 L44 L51
    Date: 2020
  7. By: Kate Nelischer (University of Toronto)
    Abstract: In an era of increasing political polarization, agreement seems difficult to come by. At the same time, recent reports show public trust in government is declining. Both conditions can make public consultation more challenging, as communities and individuals hesitate to engage with one another and with institutions, further removing themselves from policy-making processes that impact them. However, bringing people together in thoughtful dialogue remains critically important, especially as cities like Toronto continue to grow and become more diverse. Ensuring that the many different needs and priorities of residents are accurately understood is also a challenge, as researchers document lower participation rates in municipal public consultations among newcomers, women, and those with lower levels of education or income. How can meaningful consultation be achieved amid these realities? In December 2019, the Institute on Municipal Finance and Governance (IMFG) hosted a panel discussion on the role of public consultation in policy making within the context of intensifying polarization, erosion of trust, and increasing diversity. Experts offered insights gathered through their experiences in urban planning, community development, social planning, and policy initiatives, mostly within the Toronto region. The panellists were: • Cheryll Case, Urban Design Coordinator with the City of Brampton, Founder and Principal Urban Planner of CP Planning • Lindsay (Swooping Hawk) Kretschmer, Executive Director of the Toronto Aboriginal Support Services Council (TASSC) • John Robinson, Professor at the Munk School of Global Affairs and Public Policy and the School of the Environment at the University of Toronto • Nicole Swerhun, founder of Swerhun Inc., a public consultation firm • Dave Meslin (moderator), activist, artist, community organizer, and author Panellists explored the role of public consultation in policy development, connections between consultation and good governance, and challenges in existing approaches to consultation. They discussed why improvements to these processes are necessary at this particular time and offered potential strategies for more effective and inclusive decision-making. This paper presents five key principles for more meaningful consultation, distilled from panellists’ insights and relevant academic literature: 1. Build trust between government and communities, and between neighbours 2. Recognize privilege and its impacts on decisionmaking, and address inequities by making every effort to design more inclusive consultation processes 3. Share power and let communities lead, including reformulating concepts of power and recognizing the expertise and knowledge that communities hold 4. Communicate clearly and honestly, recognizing the power dynamics inherent in determining and sharing information 5. Record feedback and take action to build trust, legitimize the process, and ensure mutual benefit for participants and organizers These principles may help organizers, governments, and planners bring communities together in decision-making processes that capture the value of collective wisdom. They are predicated on the belief that better engagement will lead to policies that are more effective in addressing the many different conditions, opportunities, and challenges of our growing and diversifying urban neighbourhoods, and support the long-term health and vitality of our communities.
    Keywords: policy outcomes
    Date: 2020–09
  8. By: Anirban Mitra
    Abstract: How does economic inequality affect public spending on healthcare in democracies? Does this depend upon the demographic composition of the electorate? We build a multidimensional model of political decision-making with endogenous political parties to analyse such questions. Voters in our model differ in terms of income and age. The tax rate, the allocation of the revenue between income redistribution and two forms of public spending - healthcare and capital investment - are determined through political competition. All agents value healthcare equally but the young like capital investment more than the old do. We find that when the young are a majority, public healthcare spending tends to be lower on average than when the young are a minority. Moreover, when the old are a majority the equilibrium public healthcare provision depends critically upon the extent of income inequality. We also discuss implications regarding the on-going demographic transition (population ageing) and the Covid-19 pandemic.
    Keywords: Demography; Economic Inequality; Healthcare; Voting
    JEL: D72 H42 I14
    Date: 2021–03
  9. By: Campo, Francesco (University of Milan Bicocca); Giunti, Sara (University of Milan Bicocca); Mendola, Mariapia (University of Milan Bicocca)
    Abstract: This paper examines how the 2014-2017 'refugee crisis' in Italy affected voting behaviour and the rise of right-wing populism in national Parliamentary elections. We collect unique administrative data throughout the crisis and leverage exogenous variation in refugee resettlement across Italian municipalities induced by the Dispersal Policy. We find a positive and significant effect of the share of asylum seekers on support for radical-right anti-immigration parties. The effect is heterogeneous across municipality characteristics, yet robust to dispersal policy features. We provide causal evidence that the anti-immigration backlash is not rooted in adverse economic effects, while it is triggered by radical-right propaganda.
    Keywords: dispersal policy, voting behavior, refugee crisis, immigration, impact evaluation
    JEL: D72 F22 O15 P16
    Date: 2021–01
  10. By: Alger, Ingela; Laslier, Jean-François
    Abstract: Why do voters incur costs to participate in large elections? This paper proposes an exploratory analysis of the implications of evolutionary Kantian morality for this classical problem in the economic theory of voting: the costly participation problem.
    Keywords: voter turnout; voting, ethical voter; homo moralis; Kantian morality
    Date: 2021–02
  11. By: Fangfang Tan; Erte Xiao
    Abstract: We conduct an experiment to examine the role of retribution and deterrence in motivating third party punishment. In particular, we consider how the role of these two motives may differ according to whether a third party is a group or an individual. In a one-shot prisoner’s dilemma game with third party punishment, we find groups punish more when the penalty embeds deterrence than when it can only be retributive. In contrast, individual third parties’ punishment decisions do not vary on whether the punishment has any deterrent effect. In general, third party groups are less likely to impose punishment than individuals even though the punishment is costless for third parties.
    Keywords: Third-party punishment, group decision making, retribution, deterrence, social dilemmas, experiment
    JEL: C72 C92 D63 D70
    Date: 2019–06
  12. By: David Van Dijcke (University of Michigan, Ann Arbor); Austin L. Wright (University of Chicago - Harris School of Public Policy)
    Abstract: We develop a novel approach for estimating spatially dispersed community-level participation in mass protest. This methodology is used to investigate factors associated with participation in the ‘March to Save America’ event in Washington, D.C. on January 6, 2021. This study combines granular location data from more than 40 million mobile devices with novel measures of community-level voting patterns, the location of organized hate groups, and the entire georeferenced digital archive of the social media platform Parler. We find evidence that partisanship, socio-political isolation, proximity to chapters of the Proud Boys organization, and the local activity on Parler are robustly associated with protest participation. Our research fills a prominent gap in the study of collective action: identifying and studying communities involved in mass-scale events that escalate into violent insurrection.
    Keywords: insurrections, protests, riots, collective action, big data, cellphone, mobile devices
    Date: 2021

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.