nep-cdm New Economics Papers
on Collective Decision-Making
Issue of 2023‒05‒29
eight papers chosen by
Stan C. Weeber, McNeese State University

  1. Free Riding, Democracy and Sacrifice in the Workplace:Evidence from a Real Effort Experiment By Kenju Kamei; Katy Tabero
  2. The Economics of Partisan Gerrymandering By Anton Kolotilin; Alexander Wolitzky
  3. Who’s Afraid of Policy Experiments? By Robert Dur; Arjan Non; Paul Prottung; Benedetta Ricci
  4. Representation and Intensity of Preferences: A Public Economics Analysis of Liquid Democracy By Philémon Poux
  5. Three candidate election strategy By Dorje C. Brody; Tomooki Yuasa
  6. Sanction Enforcement among Third Parties:New Experimental Evidence from Two Societies By Kenju Kamei; Smriti Sharma; Matthew J. Walker
  7. Polarization contaminates the link with partisan and independent institutions: evidence from 138 cabinet shifts. By Luis Guirola; Gonzalo Rivero

  1. By: Kenju Kamei (Faculty of Economics, Keio University); Katy Tabero (Durham University Business School)
    Abstract: Teams are increasingly popular decision-making and work units in firms. This paper uses a novel real effort experiment to show that (a) some teams in the workplace reduce their members f @private benefits to achieve a group optimum in a social dilemma and (b) such endogenous choices by themselves enhance their work productivity (per work time production) ? a phenomenon called the gdividend of democracy. h In the experiment, worker subjects are randomly assigned to a team of three, and they then jointly solve a collaborative real effort task under a revenue-sharing rule in their group with two other teams, while each individual worker can privately and independently shirk by playing a Tetris game. Strikingly, teams exhibit significantly higher productivity (per-work-time production) when they can decide whether to reduce the return from shirking by voting than when the policy implementation is randomly decided from above, irrespective of the policy implementation outcome. This means that democratic culture directly affects behavior. On the other hand, the workers under democracy also increase their shirking, presumably due to enhanced fatigue owing to the stronger productivity. Despite this, democracy does not decrease overall production thanks to the enhanced work productivity.
    Keywords: workplace democracy, moral hazard, experiment, free riding, teamwork
    JEL: C92 D02 D72 H41
    Date: 2023–04–27
  2. By: Anton Kolotilin; Alexander Wolitzky
    Abstract: We study the problem of a partisan gerrymanderer who assigns voters to equipopulous districts so as to maximize his party's expected seat share. The designer faces both aggregate uncertainty (how many votes his party will receive) and idiosyncratic, voter-level uncertainty (which voters will vote for his party). We argue that pack-and-pair districting, where weaker districts are ``packed'' with a single type of voter, while stronger districts contain two voter types, is typically optimal for the gerrymanderer. The optimal form of pack-and-pair districting depends on the relative amounts of aggregate and idiosyncratic uncertainty. When idiosyncratic uncertainty dominates, it is optimal to pack opposing voters and pair more favorable voters; this plan resembles traditional ``packing-and-cracking.'' When aggregate uncertainty dominates, it is optimal to pack moderate voters and pair extreme voters; this ``matching slices'' plan has received some attention in the literature. Estimating the model using precinct-level returns from recent US House elections indicates that, in practice, idiosyncratic uncertainty dominates and packing opponents is optimal; moreover, traditional pack-and-crack districting is approximately optimal. We discuss implications for redistricting reform and political polarization. Methodologically, we exploit a formal connection between gerrymandering -- partitioning voters into districts -- and information design -- partitioning states of the world into signals.
    Date: 2023–04
  3. By: Robert Dur (Erasmus University Rotterdam); Arjan Non (Erasmus University Rotterdam); Paul Prottung; Benedetta Ricci
    Abstract: In many public policy areas, randomized policy experiments can greatly contribute to our knowledge of the effects of policies and can thus help to improve public policy. However, policy experiments are not very common. This paper studies whether a lack of appreciation of policy experiments among voters may be the reason for this. Using unique survey data representative of the Dutch electorate, we find clear evidence contradicting this view. Voters strongly support policy experimentation and, in line with theory, particularly so when they do not hold a strong opinion about the policy. In a subsequent survey experiment among Dutch politicians, we find that politicians conform their expressed opinion about policy experiments to what we tell them the actual opinion of voters is. We conclude that voters are not afraid of policy experiments and neither are politicians when we tell them that voters are not.
    Keywords: policy experiments, randomized controlled trials, voters, politicians, public policy, survey experiment, conformism.
    JEL: C93 D72 D78
    Date: 2023–05–08
  4. By: Philémon Poux (CRED - Centre de Recherche en Economie et Droit - Université Paris-Panthéon-Assas, CERSA - Centre d'Études et de Recherches de Sciences Administratives et Politiques - CNRS - Centre National de la Recherche Scientifique - Institut Cujas - Université Paris-Panthéon-Assas, ENPC - École des Ponts ParisTech)
    Abstract: Following an increasingly large corpus of literature championing blockchain-based voting systems and, in particular, Liquid Democracy, this paper proposes a theoretical analysis based on public economics on the issue completing the current literature which focuses more on technical issues. Differentiating between Liquid Democracy as a voting tool and as a new form of democracy, I argue that the former offers the opportunity to vote for more inclusive decisions and to better reflect voters's intensity of preferences delegation and logrolling. However, the latter does not benefit from these positive outcomes as it faces major limitations at large scales because it fails to provide a framework for bundling and for legislative work. In this paper, I conclude that reaches the conclusion that, for now, Liquid Democracy is more suited to local democracy or small-scale homogeneous groups than to larger-scale systems (such as national constitutions). Along the paper, I discuss blockchain-based examples of Liquid Democracy to illustrate the analysis and link it with recent literature.
    Date: 2023–04–12
  5. By: Dorje C. Brody; Tomooki Yuasa
    Abstract: The probability of a given candidate winning a future election is worked out in closed form as a function of (i) the current support rates for each candidate, (ii) the relative positioning of the candidates within the political spectrum, (iii) the time left to the election, and (iv) the rate at which noisy information is revealed to the electorate from now to the election day, when there are three or more candidates. It is shown, in particular, that the optimal strategy for controlling information can be intricate and nontrivial, in contrast to a two-candidate race. A surprising finding is that for a candidate taking the centre ground in an electoral competition among a polarised electorate, certain strategies are fatal in that the resulting winning probability for that candidate vanishes identically.
    Date: 2023–05
  6. By: Kenju Kamei (Faculty of Economics, Keio University); Smriti Sharma (Business School, Newcastle University); Matthew J. Walker (Business School, Newcastle University)
    Abstract: Sanction enforcement offers the potential to mitigate free riding on punishment among multiple third parties. This paper experimentally studies third-party enforcement of social norms in a prisoner fs dilemma game with and without opportunities for higher-order punishment. Based on insights from the literature on cooperation, kinship and moral systems, we compare people fs sanction enforcement across student subjects in two societies: India and the United Kingdom. The experiment results show that, in both societies, third parties f first-order punishment is most severe for defectors and that a third party fs failure to punish a defector invites higher-order punishment from their fellow third parties. These findings are consistent with a model of social preferences and literature from anthropology and theoretical biology. Further, third-party punishment is stronger in the UK than in India, consistent with the conjecture that people in a society with relatively looser ancestral kinship ties are more willing to engage in pro-social punishment. However, in contrast to the theory or conjecture, there is clear difference in the group size effects between the two research sites: whereas third parties free ride on others f punitive acts in the UK, they punish more when in the presence of other third parties in India.
    Keywords: Experiment, Third-party punishment, Higher-order, Cross-societal variation, Public Goods
    JEL: C92 H41 D01 D91
    Date: 2023–04–26
  7. By: Luis Guirola (Banco de España); Gonzalo Rivero (Independent researcher)
    Abstract: Increasing political polarization implies that each election expands the gap between the supporters of the losing side and the winning party. This asymmetry in how citizen’s feel about the outcome of elections could propagate to the institutions under partisan control but also to those designed to be isolated from electoral pressures – such as courts or central banks. Leveraging three decades of surveys covering European 27 countries, we exploit 138 cabinet shifts between 1991 and 2019 to estimate the effect of a growing divide between winners and losers on attitudes towards both types of institutions. We find that trust in either type institutions drops around elections but that the magnitude of the drop varies substantially across contexts. The polarization of parties explains most of this variance, suggesting that, in a polarized environment, partisan hostility can contaminate attitudes towards the political system as a whole creating the conditions for democratic backsliding.
    Keywords: institutions, trust, polarization
    JEL: D72 D73
    Date: 2022–10
  8. By: Timo Goeschl; ; Alice Soldà (-)
    Abstract: Pledges feature in international climate cooperation since the 2015 Paris Agreement. We explore how differences in pledgers’ trustworthiness affect outcomes in a social dilemma that parallels climate change. In an online experiment, two participants interact with a randomly matched third player in a repeat maintenance game with a pledge stage. Treatments vary whether participants are matched with a player that is more or less trustworthy as revealed by behavior in a promise-keeping game; and whether they observe that trustworthiness. We find that participants knowingly matched with more trustworthy players cooperate more than participants matched with less trustworthy players (knowingly or unknowingly), but also more than participants unknowingly matched with more trustworthy players. In contrast, participants knowingly matched with less trustworthy players do not co-operate less than participants who are unknowingly so. Our findings suggest that the use of pledges, as per the Paris Agreement, can leverage the power of trustworthiness to enhance cooperation.
    Keywords: Social dilemmas; cooperation; pre-play communication; credibility;pledges; group formation
    JEL: C72 C92 D83 D91
    Date: 2023–05

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