nep-cdm New Economics Papers
on Collective Decision-Making
Issue of 2022‒12‒05
six papers chosen by
Stan C. Weeber, McNeese State University

  1. Voter Polarization and Extremism By Eguia, Jon; Hu, Tai-Wei
  2. The Individual-Team Discontinuity Effect on Institutional Choices: Experimental Evidence in Voluntary Public Goods Provision By Kenju Kamei; Katy Tabero
  3. Do explosions shape voting behavior? By Vargas, Juan F.; Purroy, Miguel E.; Coy, Felipe; Perilla, Sergio; Prem, Mounu
  4. It's Good Weather for More Government: The Effect of Weather on Fiscal Policy By Gustavo de Souza
  5. Optimized Distortion and Proportional Fairness in Voting By Soroush Ebadian; Anson Kahng; Dominik Peters; Nisarg Shah
  6. Identity and Corruption: A Laboratory Experiment By Cubel, Maria; Papadopoulou, Anastasia; Sanchez-Pages, Santiago

  1. By: Eguia, Jon (Michigan State University, Department of Economics); Hu, Tai-Wei (University of Bristol)
    Abstract: We present a theory of endogenous policy preferences and electoral competition with boundedly rational voters who find it costly to process detailed information. Voters are otherwise fully rational, and they strategically choose how much memory to devote to processing political information. We find that even if all voters start with a common prior such that they all prefer a moderate policy over extreme alternatives to the left or the right, and even if voters observe only common signals that in the limit would assure a perfectly rational agent that the moderate policy is indeed best for everyone, a majority of voters eventually become extreme and the electorate becomes polarized: some voters support the left policy, and some support the right policy. Two fully rational parties respond by proposing extreme platforms, and thereafter, the policy outcome in every period is extreme.
    Keywords: Polarization; extremism; rational inattention; bounded memory; electoral competition
    JEL: D72
    Date: 2022–10–13
  2. By: Kenju Kamei (Faculty of Economics, Keio University); Katy Tabero (Durham University Business School)
    Abstract: A laboratory experiment is used to show that teams as a decision-making unit behave more efficiently than individuals in an institutional setting. Subjects make voting choices over formal versus informal (peer to peer) sanctions in a finitely repeated public goods dilemma. When a formal sanction scheme is selected in their groups, teams vote for deterrent sanction rates much more frequently than individuals. When an informal sanction scheme is selected, teams inflict costly punishment more frequently on low contributors than individuals, thereby reducing the relative frequency of gmisdirected h punishment among teams. As such, teams sustain cooperation surprisingly better than individuals regardless of which scheme is enacted. These behavioral patterns are consistent with the idea of gtruth wins h which proposes that teams achieve better choices than individuals through deliberation and learning. The results underscore the effectiveness of having teams as a decision-making unit in organizations in combating a moral hazard problem, such as free riding.
    Keywords: institution;public goods;experiment;punishment;discontinuity effect
    JEL: C92 D72 H41
    Date: 2022–11–10
  3. By: Vargas, Juan F.; Purroy, Miguel E.; Coy, Felipe; Perilla, Sergio; Prem, Mounu
    Abstract: Violence in conflict settings is seldom random, making its effects indistinguishable from the intentions of the perpetrator. We leverage on the quasi-randomness of accidental landmine explosions to study how violence shapes electoral outcomes in Colombia. We combine the geolocation of landmine blasts with the coordinates of voting polls in a regression discontinuity design that compares polls close to which a landmine exploded just before the election to those close to which it did just afterward. Blasts within a month from election day depress turnout by 23%. In addition, those who do vote penalize the democratic left for the explosions and are more likely to support political parties with ties with illegal paramilitary groups.
    Date: 2022–07–07
  4. By: Gustavo de Souza
    Abstract: I show that weather conditions on election day affect future fiscal policy. When it rains during state elections, there is an increase in the relative income of voters, which is followed by an increase in expenditure and debt. The increase in expenditure is directed towards a larger police and safety budget. This result is compatible with a model of complementarity between consumption and public goods. In the model, high-income voters support an increase in safety budget because they benefit more from it than low-income voters.
    Keywords: public goods; Government size; fiscal policy; weather
    JEL: D7 H0 H4 H7
    Date: 2022–10–05
  5. By: Soroush Ebadian (DCS - Department of Computer Science [University of Toronto] - University of Toronto); Anson Kahng (Department of Computer Science [Rochester] - University of Rochester [USA]); Dominik Peters (LAMSADE - Laboratoire d'analyse et modélisation de systèmes pour l'aide à la décision - Université Paris Dauphine-PSL - PSL - Université Paris sciences et lettres - CNRS - Centre National de la Recherche Scientifique); Nisarg Shah (DCS - Department of Computer Science [University of Toronto] - University of Toronto)
    Abstract: A voting rule decides on a probability distribution over a set of m alternatives, based on rankings of those alternatives provided by agents. We assume that agents have cardinal utility functions over the alternatives, but voting rules have access to only the rankings induced by these utilities. We evaluate how well voting rules do on measures of social welfare and of proportional fairness, computed based on the hidden utility functions. In particular, we study the distortion of voting rules, which is a worst-case measure. It is an approximation ratio comparing the utilitarian social welfare of the optimum outcome to the social welfare produced by the outcome selected by the voting rule, in the worst case over possible input profiles and utility functions that are consistent with the input. The previous literature has studied distortion with unit-sum utility functions (which are normalized to sum to 1), and left a small asymptotic gap in the best possible distortion. Using tools from the theory of fair multi-winner elections, we propose the first voting rule which achieves the optimal distortion Θ(√ m) for unit-sum utilities. Our voting rule also achieves optimum Θ(√ m) distortion for a larger class of utilities, including unit-range and approval (0/1) utilities. We then take a similar worst-case approach to a quantitative measure of the fairness of a voting rule, called proportional fairness. Informally, it measures whether the influence of cohesive groups of agents on the voting outcome is proportional to the group size. We show that there is a voting rule which, without knowledge of the utilities, can achieve an O(log m)-approximation to proportional fairness, which is the best possible approximation. As a consequence of its proportional fairness, we show that this voting rule achieves O(log m) distortion with respect to the Nash welfare, and selects a distribution that is approximately stable by being an O(log m)-approximation to the core, making it interesting for applications in participatory budgeting.
    Date: 2022–07
  6. By: Cubel, Maria; Papadopoulou, Anastasia; Sanchez-Pages, Santiago
    Abstract: This paper explores the role of identity in voters’ decision to retain corrupt politicians. We build up a model of electoral accountability with pure moral hazard and bring it to the lab. Politicians must decide whether to invest in a public project with uncertain returns or to keep the funds for themselves. Voters observe the outcome of the project but not the action of the politician; if the project is unsuccessful, they do not know whether it was because of bad luck or because the politician embezzled the funds. We run two treatments; a control treatment and a treatment where subjects are assigned an identity using the minimal group paradigm. Our main result is that, upon observing a failed project, voters approve politicians of their same identity group significantly more often than in the control and compared to politicians of a different group. This is partially driven by a belief on same-identity politicians being more honest. We also observe that subjects acting as politicians are much more honest than expected by the equilibrium prediction.
    Date: 2022–09–15

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