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on Collective Decision-Making |
| By: | Emeric Henry (Département d'économie); Charles Louis-Sidois |
| Abstract: | Members of groups and organizations often have to decide on rules that regulate their contributions to common tasks. They typically differ in their propensity to contribute and often care about the image they project: in particular, they want to be perceived by other group members as being high contributors. In such environments we study, from both a positive and normative perspective, the interaction between the way members vote on rules and their subsequent contribution decisions. We show how endogenous norms can emerge. We study in particular the role played by the visibility of individual actions, votes or contributions. While making votes visible always increases welfare in our setting, making contributions public can be welfare decreasing as it makes some rules more likely to be rejected. |
| Keywords: | Image concern; Voting; Public good |
| JEL: | D71 D72 H41 D23 |
| Date: | 2018–09 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpecon:info:hdl:2441/4g5hemr5o18g7os4h53mulpcam&r=all |
| By: | Choi, S; Goyal, S.; Moisan, F. |
| Abstract: | We conduct an experiment to understand the principles that govern network formation. The design of the experiment builds on a model of linking and efforts taken from Galeotti and Goyal [2010]. In order to reduce cognitive complexity facing human subjects and facilitate learning, we develop a new experimental platform that integrates a network visualization tool using an algorithm of Barnes and Hut [1986] with an interactive tool of asynchronous choices in continuous time. Our experiment provides strong support for macroscopic predictions of the theory: there is specialization in linking and efforts across all treatments. Moreover, and in line with the theory, the specialization is more pronounced in larger groups. Thus subjects abide by the law of the few. Information on payoffs provided to subjects affects their behavior and yields differential welfare consequences. In the treatment where subjects see only their own payoffs, in large groups, the most connected individuals compete fiercely-they exert large efforts and have small earnings. By contrast, when a subject sees everyone's payoffs, in large groups, the most connected individuals engage in less intense competition-they exert little effort and have large earnings. The effects of information are much more muted in small groups. |
| JEL: | C92 D83 D85 Z13 |
| Date: | 2019–03–28 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1935&r=all |
| By: | Rubio, Santiago J. |
| Abstract: | This paper studies the impact of adaptation on the stability of an international emission agreement. To address this issue we solve a three-stage coalition formation game where in the first stage countries decide whether or not to sign the agreement. Then, in the second stage, signatories (playing together) and non-signatories (playing individually) select their levels of emissions. Finally, in the third stage, each country decides on its level of adaptation non co-operatively. We solve this game for two models. For both, it is assumed that damages are linear with respect to emissions which guarantee that emissions are strategic complements in the second stage of the game. However, for the first model adaptation reduces the marginal damages of emissions in a multiplicative way whereas for the second model the reduction occurs in an additive way. Our analysis shows that the models yield different predictions in terms of participation. In the first case, we find that the larger the gains of full cooperation, the larger the cooperation. However, in the second case, the unique stable agreement we find consists of three countries regardless of the gains of full cooperation. These results suggest that complementarity can play in favor of cooperation but that it is not a sufficient condition to obtain more participation in an emission agreement. Finally, we would like to point out that our research indicates that the way adaptation reduces damages plays a critical role over the outcome of the coalition formation game. |
| Keywords: | Research Methods/ Statistical Methods |
| Date: | 2018–08–31 |
| URL: | http://d.repec.org/n?u=RePEc:ags:feemth:276179&r=all |
| By: | Thomas Demuynck; P. Jean-Jacques Herings; Riccardo D. Saulle; Christian Seel |
| Abstract: | We introduce a new solution concept for models of coalition formation, called the myopic stable set. The myopic stable set is defined for a very general class of social environments and allows for an infinite state space. We show that the myopic stable set exists and is non-empty. Under minor continuity conditions, we also demonstrate uniqueness. Furthermore, the myopic stable set is a superset of the core and of the set of pure strategy Nash equilibria in noncooperative games. Additionally, the myopic stable set generalizes and unifies various results from more specific environments. In particular, the myopic stable set coincides with the coalition structure core in coalition function form games if the coalition structure core is non-empty; with the set of stable matchings in the standard one-to-one matching model; with the set of pairwise stable networks and closed cycles in models of network formation; and with the set of pure strategy Nash equilibria in finite supermodular games, finite potential games, and aggregative games. We illustrate the versatility of our concept by characterizing the myopic stable set in a model of Bertrand competition with asymmetric costs, for which the literature so far has not been able to fully characterize the set of all (mixed) Nash equilibria. |
| Keywords: | Research Methods/ Statistical Methods |
| Date: | 2017–06–23 |
| URL: | http://d.repec.org/n?u=RePEc:ags:feemth:258008&r=all |
| By: | Richefort, Lionel |
| Abstract: | This paper explores a voluntary contribution game in the presence of warm-glow effects. There are many public goods and each public good benefits a different group of players. The structure of the game induces a bipartite network structure, where players are listed on one side and the public good groups they form are listed on the other side. The main result of the paper shows the existence and uniqueness of a Nash equilibrium. The unique Nash equilibrium is also shown to be locally asymptotically stable. Then the paper provides some comparative statics analysis regarding pure redistribution, taxation and subsidies. It appears that small redistributions of wealth may sometimes be neutral, but generally, the effects of redistributive policies depend on how public good groups are related in the contribution network structure. |
| Keywords: | Research Methods/ Statistical Methods |
| Date: | 2017–07–13 |
| URL: | http://d.repec.org/n?u=RePEc:ags:feemth:259480&r=all |
| By: | Sonja Brangewitz; Behnud Mir Djawadi; Angelika Endres; Britta Hoyer |
| Abstract: | We experimentally study the emergence of networks under a known external threat. To be more specific, we deal with the question if subjects in the role of a strategic Designer are able to form safe and efficient networks while facing a strategic Adversary who is going to attack their networks. This investigation relates theoretical predictions by Dziubinski and Goyal (2013) to actual observed behaviour. Varying the costs for protecting nodes, we designed and tested two treatments with different predictions for the equilibrium network. Furthermore, the influence of the subjects' farsightedness on their decision-making process was elicited and analysed. We find that while subjects are able to build safe networks in both treatments, equilibrium networks are only built in one of the two treatments. In the other treatment, predominantly safe networks are built but they are not efficient. Additionally, we find that farsightedness -as measured in our experiment- has no influence on whether subjects are able to build safe or efficient networks. |
| Keywords: | Research Methods/ Statistical Methods |
| Date: | 2017–06–23 |
| URL: | http://d.repec.org/n?u=RePEc:ags:feemth:258012&r=all |
| By: | Viviana Asara |
| Abstract: | The 'movements of the squares' involved first and foremost an awakening or re-discovering of the radical imagination both in the square encampments, and in later projects created with the movements' decentralizations. The new alternative projects born after the square have materialized the movements' radical imaginaries in urban environments, extending and deepening concerns of broad political change over everyday life. Based on ethnographic work on the Indignados' movement in the city of Barcelona, this paper delves more particularly into three Indignant urban projects. It untangles three common and interlinked radical imaginaries both embodied and actualized in participants' social practices, and further orienting their future visions: commons, autonomy and ecologism. Scrutinizing their meaning, it also sheds light on connected issues such new ways of interfacing with local state authorities and redefining the boundaries between the public and the common. It shows that the ecologism imaginary cannot be properly grasped if disconnected from the other two imaginaries, and argues that a transformative eco-politics can only be claimed as such if it is able to articulate such an integrated vision typical of 'socio-environmental movements'. |
| Keywords: | Indignados, imaginary, movement of the squares, commons, autonomy, environment |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwsre:sre-disc-2018_04&r=all |
| By: | Viviana Asara; Giorgos Kallis |
| Abstract: | Social movements do not only protest and demand political change – they produce new spaces too. Why and how? If we understand this, we can appreciate better the specificity and potential of the last cycle of mobilizations involving the encampment of cities’ squares. This paper shows how the Indignados movement in Barcelona evolved from symbolizing an alternative future in the square to constructing alternatives in the city after. We find that people in alternative projects re-appropriate and transform urban space because they want to live differently and produce a radically different city, now. We conceptualize these new spaces as ‘prefigurative territories’, integrating the seemingly divergent anarchist theory of prefiguration with Lefebvre’s Marxist theory of space production. Prefigurative projects have strategic horizons and struggle with conflicts when opening up. Against those charging the Indignados with a fetishization of the occupied square and a failure to achieve political goals, we argue for the continuing relevance of the movement as it moved from the production of differential, to the production of counter-spaces. Further research should investigate how these counter-spaces feed into processes of political change. |
| Keywords: | Social movement, movement of the squares, Indignados, prefigurative politics, space production, territory, community garden, Henri Lefebvre, 15-M, social centre |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwsre:sre-disc-2018_03&r=all |
| By: | Joosung Lee |
| Abstract: | We study mechanisms for environments in which only some of the agents are directly connected to a mechanism designer and the other agents can participate in a mechanism only through the connected agents' referrals. In such environments, the mechanism designer and agents may have different interest in varying participants so that agents strategically manipulate their preference as well as their network connection to avoid competition or congestion; while the mechanism designer wants to elicit the agents' private information about both preferences and network connections. As a benchmark for an efficient mechanism, we re-define a VCG mechanism. It is incentive compatible and individually rational, but it generically runs a deficit as it requires too much compensation for referrals. Alternatively as a budget-surplus mechanism, we introduce a multilevel mechanism, in which each agent is compensated by the agents who would not be able to participate without her referrals. Under a multilevel mechanism, we show that fully referring one's acquaintances is a dominant strategy and agents have no incentive to under-report their preference if the social welfare is submodular. |
| Keywords: | Research Methods/ Statistical Methods |
| Date: | 2017–06–23 |
| URL: | http://d.repec.org/n?u=RePEc:ags:feemth:258009&r=all |
| By: | Sareh Vosooghi |
| Abstract: | I examine a setting, where an information sender conducts research into a payoff-relevant state variable, and releases information to agents, who consider joining a coalition. The agents' actions can cause harm by contributing to a public bad. The sender, who has commitment power, by designing an information mechanism (a set of signals and a probability distribution over them), maximises his payoff, which depends on the action taken by the agents, and the state variable. I show that the coalition size, as a function of beliefs of agents, is an endogenous variable, induced by the information sender. The optimal information mechanism from the general set of public information mechanisms, in coalition formation games is derived. I also apply the results to International Environmental Agreements (IEAs), where a central authority, as an information sender, attempts to reduce the global level of greenhouse gases (GHG) by communication of information on social cost of GHG. |
| Keywords: | Research Methods/ Statistical Methods |
| Date: | 2017–06–23 |
| URL: | http://d.repec.org/n?u=RePEc:ags:feemth:258010&r=all |
| By: | Melo, Emerson |
| Abstract: | This paper studies strategic interaction in networks. We focus on games of strategic substitutes and strategic complements, and departing from previous literature, we do not assume particular functional forms on players' payoffs. By exploiting variational methods, we show that the uniqueness, the comparative statics, and the approximation of a Nash equilibrium are determined by a precise relationship between the lowest eigenvalue of the network, a measure of players' payoff concavity, and a parameter capturing the strength of the strategic interaction among players. We apply our framework to the study of aggregative network games, games of mixed interactions, and Bayesian network games. |
| Keywords: | Research Methods/ Statistical Methods |
| Date: | 2018–02–26 |
| URL: | http://d.repec.org/n?u=RePEc:ags:feemth:268732&r=all |
| By: | Bolton, Patrick; Li, Tao; Ravina, Enrichetta; Rosenthal, Howard |
| Abstract: | We estimate institutional investor preferences based on their proxy voting records in publicly listed Russell 3000 firms. We employ a spatial model of proxy voting, the W-NOMINATE method for scaling legislatures, and map institutional investors onto a left-right dimension based on their votes for fiscal year 2012. The far-left are socially responsible and the far-right are "money conscious" investors. Significant ideological differences reflect an absence of shareholder unanimity. The proxy adviser ISS, similar to a political leader, makes voting recommendations that place it in the center; to the left of most mutual funds. Public pension funds and other investors on the left support a more social and environment-friendly orientation of the firm and fewer executive compensation proposals. A second dimension reflects a more traditional governance view, with management disciplinarian investors, the proxy adviser Glass-Lewis among them, pitted against more management friendly ones. |
| Keywords: | institutional investors; Proxy voting; Socially responsible investment |
| JEL: | G30 G32 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13633&r=all |
| By: | David M. McEvoy; Tobias Haller; Esther Blanco |
| Abstract: | This study presents experimental results on the role that non-binding pledges have on the ability of resource users to manage the threat of probabilistic group damages in two separate environments. First, an environment where agents can work collectively to try to mitigate the root cause of the damage (mitigation), which is a form of public good. Second, an environment where in addition to collective mitigation, agents can work autonomously to protect themselves from the damages if they occur (adaptation). The tension is that mitigation and adaptation investments are strategic substitutes. We begin with a model that points to how non-binding pledges could be more effective in a world with both mitigation and adaptation strategies, compared to mitigation only. First-period results show that (i) consistent with previous literature, pledges in a mitigation-only envi- ronment do not increase average investments in collective mitigation, but (ii) when both mitigation and adaptation opportunities exist, pledges lead to higher investment in col- lective mitigation, lower investment in adaptation and increased efficiency. Although the average treatment effect disappears over time as the amount pledged decreases, pledges remain significant predictors of mitigation investments over the course of the experiment. |
| Keywords: | social dilemmas, economic experiments, behavioral economics, public goods, mitigation, adaptation, environmental damages |
| JEL: | D9 Q54 H4 C92 |
| Date: | 2019–04 |
| URL: | http://d.repec.org/n?u=RePEc:inn:wpaper:2019-04&r=all |
| By: | Büchel, Berno; Klößner, Stefan; Lochmüller, Martin; Rauhut, Heiko |
| Abstract: | We investigate how the selection process of a leader affects team performance with respect to social learning. We use a lab experiment in which an incentivized guessing task is repeated in a star network with the leader at the center. Leader selection is either based on competence, on self-confidence, or made at random. Teams with random leaders do not underperform compared to competent leaders, and they even outperform teams whose leader is selected based on self-confidence. The reason is that random leaders are better able to use the knowledge within the team. We can show that it is the declaration of the selection procedure which makes non-random leaders overly influential. We set up a horse race between several rational and naïve models of social learning to investigate the micro-level mechanisms. We find that overconfidence and conservatism contribute to the fact that overly influential leaders mislead their team. |
| Keywords: | Research Methods/ Statistical Methods |
| Date: | 2018–02–26 |
| URL: | http://d.repec.org/n?u=RePEc:ags:feemth:268729&r=all |
| By: | Luca, Davide; Rodríguez-Pose, Andrés |
| Abstract: | A growing amount of research explores how the allocation of regional development monies follows electoral reasons. Yet, the existing literature on distributive politics provides different and contrasting expectations on which geographical areas will be targeted. We focus on proportional representation (PR) systems. While in such settings governments have incentives to target core districts and punish foes', we suggest that when incumbents attempt to build a state-party image they may broaden the territorial allocation of benefits and even target opposition out-groups. We exploit data on Turkey's public transport investment for the period 2003-2014 and in-depth interviews to provide results in support of our hypothesis. |
| Keywords: | distributive politics; politics of development; Public investment; Transport Infrastructure; Turkey |
| JEL: | D72 H70 O18 O43 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13621&r=all |