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on Collective Decision-Making |
| By: | Jesús Fernández-Villaverde; Carlos Sanz |
| Abstract: | Due to a last-minute fight among the candidates, Vox, a party at the right end of the Spanish political spectrum, could not run in Santa Cruz de Tenerife, a relatively representative electoral constituency, in the general election of July 23, 2023. Since this fight was a power struggle within Vox unrelated to any fundamental in the constituency or ideological differences among the candidates, we can exploit this event as a quasi-natural experiment to measure the effects of new parties on electoral outcomes. Using three different but complementary research designs (matching, synthetic controls, and a triple-difference analysis), we get to the same main result: Vox's presence significantly increases votes for the right as a whole. The increase in votes for the right caused by Vox's presence is particularly strong in areas with high unemployment. The presence of Vox also reduces protest votes but, on the other hand, votes for the left are unaffected. |
| JEL: | D72 N30 N40 Z13 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32610&r= |
| By: | Matthew I. Jones |
| Abstract: | We introduce a new framework to study the group dynamics and game-theoretic considerations when voters in a committee are allowed to trade votes. This model represents a significant step forward by considering vote-for-vote trades in a low-information environment where voters do not know the preferences of their trading partners. All voters draw their preference intensities on two issues from a common probability distribution and then consider offering to trade with an anonymous partner. The result is a strategic game between two voters that can be studied analytically. We compute the Nash equilibria for this game and derive several interesting results involving symmetry, group heterogeneity, and more. This framework allows us to determine that trades are typically detrimental to the welfare of the group as a whole, but there are exceptions. We also expand our model to allow all voters to trade votes and derive approximate results for this more general scenario. Finally, we emulate vote trading in real groups by forming simulated committees using real voter preference intensity data and computing the resulting equilibria and associated welfare gains or losses. |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2406.09536&r= |
| By: | Amal Ahmad |
| Abstract: | In democracies with widespread poverty, what is the impact of programmatic transfers on voting and on incumbent power? This paper provides the first village-level quasiexperimental evidence on this for India, in the context of the Hindu-nationalist party in power. First, I provide a novel method for linking Indian villages to polling booths and for obtaining village-level electoral data. Second, focusing on a program which transfers development funds to villages with a high share of disadvantaged castes, I use a discontinuity design to identify the effects of both past and promised transfers on voting in India’s largest state. Promised transfers increase village turnout slightly but neither treatment impact the villages’ vote share for the Hindu-nationalist incumbent, which is high across the board. The results suggest that political competition limits the impact of programmatic transfers on voting behavior, and they shed light on the recent slide to ethnic nationalism in the world’s largest democracy. |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:not:notnic:2024-08&r= |
| By: | Jeremy Clark (University of Canterbury); Abel François; Olivier Gergaud |
| Abstract: | Among the many studied determinants of voting, we predict that i) increased social capital will be positively associated with turnout, while increased heterogeneity will be negatively associated, ii) that both factors will work through their influence on the costs of information gathering and on the social norms of voting; and iii) that heterogeneity will interact with social capital in its association with turnout. We test these predictions at the extremely fine “meshblock” level by regressing New Zealand voter turnout in its 2017 national election on its 2013 census characteristics. We use roughly 40, 000 meshblock volunteering rates to measure social capital, and heterogeneity based primarily on ethnic fragmentation. We find social capital is positively associated with voter turnout, while heterogeneity is negatively associated. We find robust evidence consistent with ethnic heterogeneity working through information costs and social norms, but less so social capital. We also find a robust interaction between social capital and heterogeneity in their association with turnout, consistent with ethnic heterogeneity raising bridging social capital that has a stronger association with turnout than in-group bonding social capital. |
| Keywords: | Electoral turnout, social capital, population diversity, ethnic heterogeneity, volunteering |
| JEL: | D72 D91 H31 |
| Date: | 2024–06–01 |
| URL: | https://d.repec.org/n?u=RePEc:cbt:econwp:24/09&r= |
| By: | Lipps, Jana; Jacob, Marc S |
| Abstract: | International organizations promoting political liberalization and economic integration have become increasingly contested by some of their own members that do not abide by liberal norms. Yet our knowledge about whether these illiberal actors might change the decision-making process within international organizations remains limited. We argue that as more illiberal domestic parties emerge, liberal majority positions in democratic international organizations face increased contestation. We expect this development to be driven mainly by illiberal parties from liberal democracies. To provide evidence for our claims, we study roll call votes in the Parliamentary Assembly of the Council of Europe (PACE), one of the most powerful international parliaments to date and one committed to promoting liberal values. Leveraging an original dataset recording about 400, 000 individual votes cast in PACE decisions, we find that illiberal parties are considerably more likely to cast dissenting votes than liberal parties. In contrast to our theoretical expectations, illiberal parties from illiberal (and not liberal) political systems challenge the majority most often. However, being in government mitigates illiberal parties’ challenging behavior. Our study has implications for the potential threat of emerging illiberal actors to international liberal institutions and organizations. |
| Keywords: | Social and Behavioral Sciences, Liberal International Order, Illiberalism, International Parliamentary Institutions, Voting, Democracy, Parliamentary Assembly of the Council of Europe |
| Date: | 2022–08–17 |
| URL: | https://d.repec.org/n?u=RePEc:cdl:globco:qt6fg0093j&r= |
| By: | Berliant, Marcus; Gouveia, Miguel |
| Abstract: | The literatures dealing with voting, optimal income taxation, implementation, and pure public goods are drawn on here to address the problem of voting over income taxes to finance a public good. In contrast with previous articles, general nonlinear income taxes that affect the labor-leisure decisions of consumers who work and vote are allowed. Uncertainty plays an important role in that the government does not know the true realizations of the abilities of consumers drawn from a known distribution, but must meet the realization-dependent budget; the tax system must be robust. Even though the space of alternatives is infinite dimensional, conditions on primitives are found to assure existence of a majority rule equilibrium. |
| Keywords: | Voting; Income taxation; Public good; Robustness |
| JEL: | D72 D82 H21 H41 |
| Date: | 2024–06–20 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:121260&r= |
| By: | Lupu, Noam |
| Abstract: | Latin America is widely acknowledged as one of the most unequal regions of the world (Sánchez-Ancochea 2021). But it is also one of the most democratic, certainly as compared to other developing regions. These two facts seem difficult to reconcile. Both folk theories of democratic representation to borrow a phrase from (Achen and Bartels 2016) and canonical models in political economy would have us believe that democracies ought to reduce inequality through redistribution (e.g., Acemoglu and Robinson 2006; Meltzer and Richard 1981; Romer 1975). As inequality increases, the proportion of the population that would benefit materially from redistribution also increases, making it more likely that a pro-redistribution political coalition would win elections and deliver social policy. And yet, despite several decades of uninterrupted electoral democracy in most of the region, Latin American governments have consistently and with but few exceptions failed to reduce inequality substantially. This paper begins by discussing why contemporary Latin American party systems are weak, focusing on both structural/institutional factors that pull party systems toward less institutionalization and recent changes to the regions political economy that undermined the more institutionalized systems. Then links the regions low levels of party-system institutionalization with lower levels of redistribution, both theoretically and empirically through cross-national comparisons. Finally, the mass and elite surveys show that legislatures in the region fail to reflect the pro-redistribution preferences of voters, further demonstrating how weak parties undermine the representation necessary for successful redistribution. |
| Keywords: | Inequality;Political Processes;National Government |
| JEL: | D30 D72 H50 P00 |
| Date: | 2024–04 |
| URL: | https://d.repec.org/n?u=RePEc:idb:brikps:13481&r= |
| By: | Edwin Hu; Nadya Malenko; Jonathon Zytnick |
| Abstract: | This paper studies institutional investors’ decision-making using novel data from a major proxy advisor. We highlight the significant role of customized proxy advice in shaping shareholders’ voting decisions. About 80% of funds receive customized advice, and custom recommendations differ substantially from benchmark recommendations. We show that customization plays two key roles. First, it helps shareholders express their ideologies through the vote. Second, it facilitates shareholders’ decision-making process by reducing the need to pay attention to every proposal individually and enabling focus on the more important proposals. Customization thus influences both the aggregation of preferences and the aggregation of information in voting outcomes. Our findings offer a new perspective on the role of proxy advisors and suggest a shift away from solely focusing on benchmark recommendations. |
| JEL: | D72 G23 G34 G38 K22 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32559&r= |
| By: | Gopakumar Achuthankutty (Indira Gandhi Institute of Development Research) |
| Abstract: | This paper explores the incentive properties of Collective Identity Functions (CIFs) in multinary group identification problems. Building on Cho and Saporiti (2020), we show that one-vote rules (Miller (2008), Cho and Ju (2017)) are manipulable. Additionally, we establish the decomposability of strategy-proof CIFs, enhancing our understanding of their structural properties. |
| Keywords: | Strategy-proofness, Multinary group identification |
| JEL: | D70 D71 D72 |
| Date: | 2024–03 |
| URL: | https://d.repec.org/n?u=RePEc:ind:igiwpp:2024-006&r= |
| By: | Basistha, Ahana (Indian Statistical Institute); Dhillon, Amrita (Kings College and CAGE); Chaudhuri, Arka Roy (Shiv Nadar University) |
| Abstract: | This paper analyzes the existence of electoral cycles in infrastructure provision in the context of a large rural road building program in India. We use data covering 150, 000 roads over a decade to demonstrate an increase in road building activity before state elections. These electoral cycles in rural road building do not translate into efficiency losses in terms of quality, cost or delay. However, we find evidence that politicians build roads with a lower stipulated construction time before elections. In line with our model’s predictions, we also find that electoral constituencies with a larger share of uninformed voters display larger electoral cycles. |
| Keywords: | Political Business Cycles, Elections, Public Goods, Rural Infrastructure, India JEL Classification: D72, D73, H41, O18 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:cge:wacage:712&r= |
| By: | Olejnik, Łukasz Wiktor |
| Abstract: | This article demonstrates that the influence of government ideology on military expenditures is more nuanced than it was shown in previous research and using only aggregated military expenditures may provide ambiguous results. The disaggregation of military expenditures allows concluding that in the 29 studied EU and NATO countries, right-wing governments tend to spend more on military equipment and arms purchases, while left-wing governments tend to spend more on military personnel. Government ideology may also create compositional political budgetary cycles, due to the fact that left-wing governments fighting for re-election significantly increase personnel expenditures in election years, while right-wing governments spend significantly more on arms for soldiers. Moreover, using a newly created dataset of election results in 510 municipalities or constituencies with military bases in 29 EU and NATO countries allows concluding that governments with above-average support of military-related voters in previous elections spend more on the military during the entire term, which suggest that ruling politicians support their core voters. |
| Keywords: | economic theory of alliances, peace and defence economics, military burden |
| JEL: | H56 H76 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:zewdip:300005&r= |
| By: | Miettinen, Topi; Vanberg, Christoph |
| Abstract: | We theoretically investigate how the application of unanimity rule can lead to inefficient delay in collective decision making. We do so in the context of a distributive multilateral bargaining model featuring strategic pre-commitment. Prior to each bargaining round, players can declare a minimum share that they must receive in return for their vote. Such declarations become binding with an exogenously given probability. We characterize the set of stationary subgame perfect equilibria under all q-majority rules. Our results suggest that unanimity rule is uniquely inefficient. All other rules, including all-but-one, are fully efficient. |
| Keywords: | bargaining; commitment; conflict; delay; international negotiations; climate negotiations; legislative; multilateral; voting; majority; unanimity |
| Date: | 2024–06–25 |
| URL: | https://d.repec.org/n?u=RePEc:awi:wpaper:0749&r= |
| By: | Mashbat Suzuki; Jeremy Vollen |
| Abstract: | In the committee voting setting, a subset of $k$ alternatives is selected based on the preferences of voters. In this paper, our goal is to efficiently compute ex-ante fair probability distributions (or lotteries) over committees. Since it is not known whether a lottery satisfying the desirable fairness property of fractional core is polynomial-time computable, we introduce a new axiom called group resource proportionality (GRP), which strengthens other fairness notions in the literature. We characterize our fairness axiom by a correspondence with max flows on a network formulation of committee voting. Using the connection to flow networks revealed by this characterization, we then introduce voting rules which achieve fairness in conjunction with other desirable properties. The redistributive utilitarian rule satisfies ex-ante efficiency in addition to our fairness axiom. We also give a voting rule which maximizes social welfare subject to fairness by reducing to a minimum-cost maximum-flow problem. Lastly, we show our fairness property can be obtained in tandem with strong ex-post fairness properties -- an approach known as best-of-both-worlds fairness. We strengthen existing best-or-both-worlds fairness results in committee voting and resolve an open question posed by Aziz et al. (2023). These findings follow from an auxiliary result which may prove useful in obtaining best-of-both-worlds type results in future research on committee voting. |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2406.14907&r= |
| By: | Robin J. Döttling; Doron Y. Levit; Nadya Malenko; Magdalena A. Rola-Janicka |
| Abstract: | We study the interplay between a "one person-one vote" political system and a "one share-one vote" corporate governance regime. The political system sets Pigouvian subsidies, while corporate governance determines firm-specific public good investments. Our analysis highlights a two-way feedback effect. In a frictionless economy, shareholder democracy is irrelevant: the political system fully offsets any effects of shareholder influence. With frictions in public policy provision, pro-social corporations fill the void of a dysfunctional regulatory system and increase the provision of public goods-demonstrating the benefit of shareholder democracy. Nevertheless, shareholder democracy can hurt a typical citizen because of the representation problem: it favors the preferences of the wealthy. If shareholders have extreme views, there can be a backlash against ESG initiatives, and the political system may undo or tax corporate social responsibility measures. Advancements in financial technologies that increase investor diversification or enable pass-through voting have important implications for these trade-offs of shareholder democracy. |
| JEL: | D62 D72 G28 G34 H23 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32605&r= |
| By: | Giovanni Valvassori Bolg\`e |
| Abstract: | A set of agents has to make a decision about the provision of a public good and its financing. Agents have heterogeneous values for the public good and each agent's value is private information. An agenda-setter has the right to make a proposal about a public-good level and a vector of contributions. For the proposal to be approved, only the favourable votes of a subset of agents are needed. If the proposal is not approved, a type-dependent outside option is implemented. I characterize the optimal public-good provision and the coalition-formation for any outside option in dominant strategies. Optimal public-good provision might be a non-monotonic function of the outside option public-good level. Moreover, the optimal coalition might be a non-convex set of types. |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2406.08936&r= |
| By: | Breyer, Friedrich; Breunig, Christian; Kapteina, Mark; Schwerdt, Guido; Sterba, Maj-Britt |
| Abstract: | Citizens and politicians rely on their knowledge of a pension system, particularly its redistributive features, when forming their preferences and evaluating its fairness. Taking advantage of the Bismarckian rule of proportionality in Germany, we provide experimental and survey-based evidence indicating that voters and politicians adjust their preferences and perceptions of fairness when new information becomes available. Information on the proportional character of the pension system increases perceived fairness and decreases redistributive demands, whereas information about inequalities in life expectancy between beneficiary groups lowers perceived fairness and increases the demand for redistribution. Both citizens and politicians reject the Bismarckian principle of strict proportionality between lifetime contributions and pension benefits in favor of more redistribution from high to low earners in the retirement phase. Our design utilizes a representative survey of citizens and state politicians in 2020-22. |
| Keywords: | public pensions, preferences, redistribution, Germany, elites |
| JEL: | H55 D72 D83 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:cexwps:299999&r= |
| By: | Alexander Cappelen (NHH Norwegian School of Economics, FAIR The Choice Lab); Yiming Liu (HU Berlin, WZB Berlin Social Science Center); Hedda Nielsen (HU Berlin); Bertil Tungodden (NHH Norwegian School of Economics, FAIR The Choice Lab) |
| Abstract: | Modern societies are characterized by widespread disparities in opportunities, which play a crucial role in creating income inequality. This paper investigates how individuals handle income inequality arising from these unequal opportunities. We report from a large-scale experimental study involving general populations in the United States and Scandinavia, where participants make consequential redistributive decisions as third-party ‘spectators’ for workers who faced unequal opportunities. Our findings provide strong evidence that a significant majority of people are willing to accept inequality caused by unequal opportunities, a position that markedly contrasts with their responses to inequality caused by luck. Two distinct forces drive greater acceptance of inequality under unequal opportunities: the tendency to mistakenly attribute the impact of unequal opportunities to inherent productivity, and the moral relevance attributed to choice differences caused by unequal opportunities. We further demonstrate a clear societal and political divide in responses to unequal opportunities, with Americans and right-wing voters exhibiting a greater acceptance of the resulting inequality, reflecting both differences in fairness views and attribution biases in these populations. |
| Keywords: | unequal opportunities; inequality acceptance; attribution bias; fairness views; |
| Date: | 2024–07–05 |
| URL: | https://d.repec.org/n?u=RePEc:rco:dpaper:506&r= |