is approval voting an unmitigated evil a response to brams fishburn and merrill brams fishburn and merrill 1988 contend that the indeterminacy of approval voting av introduced in our paper 1988 is not a vice but a surpassing virtue of av they do not compare the negative versus the positive features of av so their assertion remains a conjecture our response emphasizes the need to determine the costs of av and to evaluate them against any merits moreover by correcting and answering bfm s comments the argument against av becomes much stronger this is because we show that av s region of indeterminacy is quite large it includes most profiles some of the consequences of this instability are that the av outcome can negate the voter s true wishes that the av outcome can be volatile even to minor fluctuations of voter s decisions and that av is one of the most susceptible systems to manipulation by small groups of voters for example small maverick groups could determine the av outcome under specific circumstances av may be appropriate to identify these situations we propose the more accurate name of the unsophisticated voter system

the effect of decision order on purchase quantity decisions abstract consumers often resolve trade offs in a particular order for example when making flavor and size decisions consumers might first decide which flavors to choose and then decide which sizes of those flavors to choose this research examines the effect of decision order on purchase quantity decisions the authors build on prior work on decision difficulty and conflict to show that consumers choose more overall and more variety when they consider a less replaceable attribute in an earlier rather than a later stage in the purchase decision for example consumers choose a greater quantity when flavor or brand decisions precede rather than follow size decisions the authors find that the degree of attribute replaceability also moderates the effect of decision order on quantity chosen furthermore marketers can influence the amount chosen by altering the organization of the shelf display finally the authors find that when consumers explicitly consider the possibility of deferring their dec

a theory of voting equilibria a voting equilibrium arises when the voters in an electorate acting in accordance with both their preferences for the candidates and their perceptions of the relative chances of various pairs of candidates being in contention for victory generate an election result that justifies their perceptions voting equilibria always exist and the set of equilibria can vary substantially with the choice of voting system we compare equilibria under the plurality rule approval voting and the borda system we consider a candidate positioning game and find that the plurality rule imposes little restriction on the position of the winning candidate in three candidate races while approval voting leads to a winner positioned at the median of the voter distribution we contrast campaign activities intended to influence voter preferences with activities meant to influence only perceptions of candidate viability

the effect of time pressure on consumer choice deferral this article investigates the effect of time pressure on choice deferrai recent research suggests that the likelihood of deferral is contingent on the ease of making the selection decision which option to choose as well as the overali attractiveness of the selected alternative we focus on how time pressure systematically impacts choice deferral by increasing the use of noncompensato ry decision rules in the selection decision and by increasing the relative emphasis placed on the unique features in the deferral decision whether to choose consistent with the hypotheses we find over a series of five studies that time pressure 1 decreases choice deferral when choice involves high conflict but not when conflict is low 2 reduces the impact of shared features on choice deferral and 3 decreases choice deferral for sets with common bad and unique good features approach approach conflict but not for sets with common good and unique bad features avoidance avoidance conflict we further show that greater attention to the unique features is not a general property of decision making under time pressure but rather a consequence of the primacy of the selection decision over the deferral decision consistent with this premise time pressure did not decrease the relative attention paid to common features when the task was described as purely a deferral decision the theoretical and practical implications of the findings are discussed

explaining patterns of candidate competition in congressional elections the low probability of defeating incumbent members of congress deters potentially strong rivals from challenging them yet almost all incumbents are challenged usually by opponents who lack previous experience in office and run underfinanced ineffectual campaigns but if strong challengers are deterred from challenging incumbents why are not weak challengers who have even less chance of unseating an incumbent the model developed in this paper indicates that there is a simple reason why weak candidates choose to run against incumbents they do so in order to maximize their probability of getting elected to congress together with the findings of previous researchers the results of our analyses of congressional primary data from 1980 through 1984 provide strong support for the major hypotheses derived from our model

approval voting borda winners and condorcet winners evidence from seven elections we analyze 10 three candidate elections and mock elections conducted under approval voting av using a method developed by falmagne and regenwetter 1996 that allows us to construct a distribution of rank orders from subset choice data the elections were held by the institute of management science the mathematical association of america several professional organizations in britain and the institute of electrical and electronics engineers seven of the 10 elections satisfy the conditions under which the falmagne regenwetter method is suitable for these elections we recreate possible underlying preferences of the electorate on the basis of these distributions of preferences we find strong evidence that av would have selected condorcet winners when they exist and would have always selected the borda winner thus we find that av is not just simple to use but also gives rise to outcomes that well reflect voter preferences our results also have an important implication for the general study of social choice processes they suggest that transitive majority orderings may be expected in real world settings more often then the formal social choice literature suggests in six out of seven data sets we find social welfare orders only one data set generates cycles anywhere in the solution space

the vulnerability of point voting schemes to preference variation and strategic manipulation this essay measures and analyzes for a special class of point voting schemes the borda method plurality rule and the unrestricted point voting scheme sensitivity to preference variation a simple change in the socially winning alternative resulting from alteration of a single voter s preferences and vulnerability to individual strategic manipulation a change in the winning alternative that benefits the voter whose preferences are altered assuming that society n voters with linear preference orders on a finite set of m alternatives satisfies the impartial culture assumption that is each randomly selected voter is equally likely to hold any one of the randomly picked possible preference orders on the alternatives we demonstrate

prices or knowledge what drives demand for financial services in emerging markets this brief summarizes the results of a gender impact evaluation study entitled prices or knowledge what drives demand for financial services in emerging markets conducted in 2008 in indonesia the study observed that financial development is critical for growth but its micro determinants are not well understood financial literacy training has no impact on the probability of opening a bank account although it does have an impact among those with low levels of education and financial literacy a change from 3 to 14 led to a 7 6 percent increase in the probability of owning a bank account the results hold two years after a study funding for the study derived from world bank hbs division of research and faculty development

president perot or fundamentals of voting theory illustrated with the 1992 election different voting systems can lead to different election outcomeseven when voter preferences are held constant using the 1992 election as anexample it is shown how the outcome of every positional votesystem can be found similarly every possible cumulative andapproval vote outcome is shown multiple vote systems likeapproval and cumulative voting have disturbing properties usingthe 1992 election as illustration it is shown how a candidate whowins under every positional vote system who wins every pairwisevote i e is the condorcet winner and who has the most firstplace and least last place votes may nevertheless lose underapproval or cumulative voting similarly it is shown how acandidate who loses under every positional system who loses everypairwise vote i e is the condorcet loser and who has the leastfirst place and most last place votes may nevertheless win underapproval or cumulative voting

getting to the top of mind how reminders increase saving we provide evidence from field experiments with three different banks that reminder messages increase commitment attainment for clients who recently opened commitment savings accounts messages that mention both savings goals and financial incentives are particularly effective whereas other content variations such as gain versus loss framing do not have significantly different effects nor do we find evidence that receiving additional late reminders has an additive effect these empirical results do not map neatly into existing models so we provide a simple model where limited attention to exceptional expenses can generate undersaving that is in turn mitigated by reminders data as supplemental material are available at http dx doi org 10 1287 mnsc 2015 2296 this paper was accepted by teck hua ho behavioral economics

the source of some paradoxes from social choice and probability abstract an elementary argument is developed to explain and unite several paradoxes coming from probability and from social choice this geometric approach is illustrated with new results about the intransitivities of election rankings over subsets of alternatives agenda manipulation conditional probability and waiting times

an introduction to vote counting schemes t he design of an electoral system is fundamental to any democracy motivation for understanding how electoral system design matters comes from many directions the creation of new constitutions in eastern europe the recent trauma of a three way presidential election in the united states the ongoing debate over u s redistricting and gerrymandering the furor caused by lani guinier s call for a more representative voting system the status quo adds another incentive plurality rule is pervasive even though it is a flawed system fortunately there is no lack of suitable alternatives one of the purposes of this symposium and this paper in particular is to help illustrate and motivate the remarkable variety of alternative mechanisms that aggregate individual preferences to decide an election this overview offers a summary of sixteen distinct methods and demonstrates by example how some of the more complex systems work the shorter papers that follow focus on some of the more popular alternatives including approval voting single transferable vote the maximum likelihood rule and more one can speculate on why alternatives to plurality rule have had such a difficult time being adopted part of the cause may be arrow s general possibility theorem arrow 1951 demonstrates that any voting system applied to an unrestricted collection of voter preferences must have some serious defect we must always choose between flawed alternatives with conflicting theoretical guidance to help select the least flawed option people evaluate a system by its likely effect on the status quo outcome since those in power tend to want to

rotating savings and credit associations credit markets and efficiency this paper examines the allocative performance of rotating savings and credit associations roscas a financial institution which is observed world wide we develop a model in which individuals save for an indivisible good and study roscas which distribute funds using random allocation and bidding the allocations achieved by the two types of rosca are compared with that achieved by a credit market and with efficient allocations more generally we find that neither type of rosca is efficient and that individuals are better off with a credit market than a bidding rosca nonetheless a random rosca may sometimes yield a higher level of ex ante expected utility to prospective participants than would a credit market i introduction rotating savings and credit associations roscas are a widely observed institution for financial intermediation they are found all over the world particularly in developing countries and have heretofore received scant attention from economists this paper and its companion piece besley coate and loury 1993 constitute a first attempt to analyse their economic role and performance roscas come in two main forms the first type allocates funds randomly in a random rosca members commit to putting a fixed sum of money into a pot for each period of the rosca s life lots are drawn and the pot is randomly allocated to one of the members in the next period the process repeats itself with each previous winner excluded from the draw the process continues until each rosca member has received the pot once at this point the rosca is either disbanded or begins over again individuals may also form a bidding rosca in which the pot is allocated via a bidding procedure the individual who

an economic model of representative democracy this paper develops an approach to the study of democratic policy making where politicians are selected by the people from those citizens who present themselves as candidates for public office the approach has a number of attractive features first it is a conceptualization of a pure form of representative democracy in which government is by as well as of the people second the model is analytically tractable being able to handle multidimensional issue and policy spaces very naturally third it provides a vehicle for answering normative questions about the performance of representative democracy

pension plan characteristics and framing effects in employee savings behavior abstract defined contribution pensions in many postsecondary institutions are funded by a combination of an employer premium and a mandatory employee premium individuals can also contribute to a supplemental savings account holding constant total compensation standard reasoning suggests that supplemental savings should depend negatively on the sum of the employer and employee pension contributions contrarily we find that the supplementary savings of professors are significantly more sensitive to employee contributions than to employer contributions this asymmetry is consistent with different marginal propensities to save out of the salary and pension components of compensation nevertheless impacts on lifetime utility are relatively modest

consumer preference for a no choice option the traditional focus in the decision making literature has been on understanding how consumers choose among a given set of alternatives the notion that preference uncertainty may lead to choice deferral when no single alternative has a decisive advantage is tested in seven studies building on recent research the article shows that the decision to defer choice is influenced by the absolute difference in attractiveness among the alternatives provided and is not consistent with trade off difficulty or the theory of search these findings are then extended to show that choice deferral can also be modified for the same alternatives by manipulations that make them appear more similar in attractiveness or that decrease the need to differentiate among them the results are consistent with the notion that preference uncertainty results in a hesitation to commit to any single action since small differences in attractiveness among the alternatives are potentially reversible consistent with this premise the effect of attractiveness difference on choice deferral decreased significantly when subjects were first allowed to practice making monetary trade offs among the available alternatives

collective choice under dichotomous preferences abstract agents partition deterministic outcomes into good or bad a mechanism selects a lottery over outcomes time shares the probability of a good outcome is the canonical utility the utilitarian mechanism averages over outcomes with largest approval it is efficient strategyproof anonymous and neutral we reach an impossibility if in addition each agent s utility is at least 1 n where n is the number of agents or is at least the fraction of good to feasible outcomes we conjecture that no ex ante efficient and strategyproof mechanism guarantees a strictly positive utility to all agents and prove a weaker statement

the economics of roscas and intrahousehold resource allocation this paper investigates individual motives to participate in rotating savings and credit associations roscas detailed evidence from roscas in a kenyan slum nairobi suggests that most roscas are predominantly composed of women particularly those living in a couple and earning an independent income to explain this phenomenon we propose an argument based on conflictual interactions within the household participation in a rosca is a strategy a wife employs to protect her savings against claims by her husband for immediate consumption the empirical implications of the model are then tested using the data collected in kenya

the incumbency effects of signalling much literature on political behaviour treats politicians as motivated by re election choosing actions to signal their types to voters we identify a novel implication of incumbent signalling because incumbents only care about clearing a re election hurdle signals will tend to cluster just above the threshold needed for re election this generates a skew distribution of signals leading to an incumbency advantage in the probability of election we also solve for the optimal threshold when voters have the ability to commit

weak condorcet winner s revisited a strong condorcet winner scw is an alternative x that a majority of voters rank higher than z for every other alternative z a weak condorcet winner wcw is an alternative y that no majority of voters rank below any other alternative z but is not a scw there has been some confusion in the voting social choice literature as to whether particular voting rules that are scw consistent are also wcw consistent the purpose of this paper is to revisit this issue clear up the confusion that has developed and determine whether three additional scw consistent voting rules that as far as we know have not been investigated to date regarding their possible wcw consistency are indeed wcw consistent

a dictionary for voting paradoxes abstract a sonnenschein mantel debreu kind of characterization is found for positional voting procedures namely for n 2 candidates once the voting procedures and a profile are specified the rankings of all possible subsets of candidates are uniquely determined by varying over all profiles one obtains a dictionary of all possible coordinated election outcomes this is done for all positional voting procedures as with excess demand functions anything can happen voting paradoxes can be very complicated only borda s method avoids many paradoxes use of this dictionary is illustrated by significantly extending several well known paradoxes and by obtaining new results about runoff and agenda elections strategic behavior etc

the problem of strategic behavior under approval voting approval voting is being promoted as the election reform of the 20th century brams 1980 p 105 and indeed if voters preferences are dichotomous approval voting has some remarkable qualities it is uniquely strategy proof a candidate wins if and only if he is a condorcet winner and voters have simple strategies that are at once sincere and sophisticated however all of these results depend on the existence of dichotomous preferences a contrived and empirically unlikely assumption here i show that these virtues of approval voting are replaced by some rather undesirable features under more plausible assumptions more fundamentally rather than promoting honest behavior as is sometimes implied the existence of multiple sincere strategies almost begs voters to behave strategically i also examine sophisticated approval voting and show that in the general case it need not pick a condorcet alternative ironically there is a condition under which condorcet winners may always be picked but for this to occur voters sometimes have to vote for candidates of whom they disapprove

the paradox of grading systems we distinguish between i voting systems in which voters can rank candidates and ii those in which they can grade candidates using two or more grades in approval voting voters can assign two grades only approve 1 or not approve 0 to candidates while two grades rule out a discrepancy between the average grade winners who receive the highest average grade and the superior grade winners who receive more superior grades in pairwise comparisons akin to condorcet winners more than two grades allow it we call this discrepancy between the two kinds of winners the paradox of grading systems which we illustrate with several examples and whose probability we estimate for sincere and strategic voters through a monte carlo simulation we discuss the tradeoff between i allowing more than two grades but risking the paradox and ii precluding the paradox but restricting voters to two grades

explaining all three alternative voting outcomes abstract a theory is developed to explain all possible three alternative single profile pairwise and positional voting outcomes this includes all preference aggregation paradoxes cycles conflict between the borda and condorcet winners differences among positional outcomes e g the plurality and antiplurality methods and differences among procedures using these outcomes e g runoffs kemeny s rule and copeland s method it is shown how to identify interpret and construct all profiles supporting each paradox among new conclusions it is shown why a standard for the field the condorcet winner is seriously flawed journal of economic literature classification numbers d72 d71

the problem of indeterminacy in approval multiple and truncated voting systems it is well known that a plurality election need not reflect the true sentiments of the electorate some of the proposed reform procedures such as approval and cumulative voting share the characteristics that there are several ways to tally each voter s preferences voting systems that permit truncated ballots share this feature it is shown that the election results for any such procedure can be highly indeterminate all possible election results can occur with the same choice of sincere voters this conclusion of indeterminacy holds even when measures of voters sentiments such as the existence of a condorcet winner or even much stronger measures indicate there is considerable agreement among the voters then multiple systems are compared with all standard tallying procedures for instance a corollary asserts it is probable for the plurality voting method to elect the condorcet winner while approval voting has an indeterminate outcome

divided majority and information aggregation theory and experiment this paper studies theoretically and experimentally the properties of plurality and approval voting when a majority gets divided by information imperfections the majority faces two challenges aggregating information to select the best majority candidate and coordinating to defeat the minority candidate under plurality the majority cannot achieve both goals at once under approval voting it can welfare is strictly higher because some voters approve of both majority alternatives in the laboratory we find i strong evidence of strategic voting and ii superiority of approval voting over plurality finally subject behavior suggests the need to study equilibria in asymmetric strategies

a new approach to measure tactical voting evidence from the british elections although tactical voting attracts a great deal of attention it is very hard to measure as it requires knowledge of both individuals voting choices as well as their unobserved preferences in this article we present a simple empirical strategy to nonparametrically identify tactical voting patterns directly from balloting results this approach allows us to study the magnitude and direction of strategic voting as well as to verify which information voters and parties take into account to determine marginal constituencies we show that tactical voting played a significant role in the 2010 election mainly for liberal democratic voters supporting labour moreover our results suggest that voters seem to form their expectations based on a national swing in vote shares rather than newspaper guides published in the main media outlets or previous election outcomes we also present some evidence that suggests that campaign spending is not driving tactical voting

roscas as financial agreements to cope with self control problems abstract we consider a model in which people with limited self control can sign binding financial agreements among themselves thereby forming coalitions we show that these financial agreements may help them to alleviate their self control problems we then demonstrate that there exists a stable structure of coalitions in which people form rotating savings and credit associations roscas we therefore provide a behavioral rationale for one of the most prevalent and puzzling financial institutions in developing countries finally we derive and discuss some empirical predictions

strategic manipulation in voting games when lotteries and ties are permitted abstract a gibbard satterthwaite type theorem is established for random decision rules and rules that permit ties the rules use full information on how individuals rank lotteries and sets of outcomes the theorem allows restrictions on the domain of rankings journal of economic literature classification numbers d7 c7

managerial incentive problems a dynamic perspective the paper studies how a person s concern for a future career may influence his or her incentives to put in effort or make decisions on the job in the model the person s productive abilities are revealed over time through observations of performance there are no explicit output contingent contracts but since the wage in each period is based on expected output and expected output depends on assessed ability an implicit contract links today s performance to future wages an incentive problem arises from the person s ability and desire to influence the learning process and therefore the wage process by taking unobserved actions that affect today s performance the fundamental incongruity in preferences is between the individual s concern for human capital returns and the firm s concern for financial returns the two need be only weakly related it is shown that career motives can be beneficial as well as detrimental depending on how well the two kinds of capital returns are aligned it is well understood by now that informational externalities may place special demands on the organization of economic exchange simple price mediated markets will frequently fail in the presence of asymmetric information in that case more elaborate contractual arrangements have to be used as substitutes for the price system lately considerable effort has been devoted to the analysis of contracting under incomplete information with the objective to understand the range of economic institutions that emerge in response to the failure of the price system the analysis of moral hazard has played a prominent role in this development moral hazard problems arise when for some reason or another transacting parties cannot contract contingent on the delivery of the good for instance in buying labour services it may be that the amount of labour supplied is not directly observable precluding a simple exchange of wage for labour as a partial remedy to this problem an imperfect mutually observed signal about the supply of labour can be used as a proxy in the contract frequently output is taken as such a proxy the drawback is that output is often influenced by other factors than labour input which induce undesirable risk into the contract one is therefore faced with a tradeoff between allocating risk associated with incomplete observability and providing incentives for a proper supply of labour gaining insight into this tradeoff is important not only for understanding contracting in the small e g managerial incentive schemes but also because it is closely related to the fundamental tension between equity and efficiency in the society as a whole while our understanding of moral hazard has advanced a lot in past years it is clear that much work remains an important question that has received little attention until

susceptibility to manipulation all positional voting procedures can be manipulated so it is natural to question whether some of these systems are more susceptible to being manipulated than others in this essay this susceptibility factor is measured for strategic action involving small groups it is shown that the system least susceptible to micro manipulations for n 3 candidates is the borda count bc the optimal choice changes with n but the analysis shows that the bc always fares fairly well on the other hand the plurality and anti plurality vote as well as multiple voting systems such as approval voting and cumulative voting always fare quite poorly with respect to susceptibility finally it is shown why it is possible to justify any voting method by choosing an appropriate measure of susceptibility and imposing the appropriate assumptions on the profiles of voters this statement emphasizes the importance of the basic assumptions of neutrality used throughout this essay

on the empirical relevance of condorcet s paradox condorcet s paradox occurs when there is no alternative that beats every other alternative by majority the paradox may pose real problems to democratic decision making such as decision deadlocks and democratic paralysis however its relevance has been discussed again and again since the celebrated works of arrow social choice and individual values 1963 and black the theory of committees and elections 1958 the discussion varies from one extreme to the other from very relevant to practically irrelevant this paper tries to bring more clarity to the discussion by reviewing the literature on the empirical relevance of condorcet s paradox since a definition of the paradox for even numbers of voters and alternatives and for weak voter preferences is missing in the literature we first define the paradox clearly and simply then three topics are investigated namely domain conditions culture and the likelihood of the paradox and the empirical detection of the paradox domain conditions express regularities in voter preference profiles that prevent the paradox frequent observations of these domain conditions would make condorcet s paradox empirically less important cultures define probability distributions over the set of voter preferences observation of cultures might be a first step to indicate the relevance of the paradox the empirical detection of the paradox speaks for itself we will try to identify the number of observations of the paradox so far the overall conclusion is that the empirical relevance of condorcet s paradox is still unsettled

the effect of local consideration sets on global choice between lower price and higher quality a set of alternatives under consideration is often divided into subsets or local sets by some external e g product display format at the store or internal e g a decision rule factor we propose that the manner in which a global set of alternatives varying in price and quality is divided into local sets can have a systematic effect on consumer choice between a lower price alternative and a higher quality alternative three such effects are investigated 1 consumers who first choose from pairs of products a b b c a c and then choose from the set of all three products a b c are more likely to prefer the cheapest alternative than consumers who only choose from the complete set 2 the choice share of a low price low quality brand is greater when alternatives varying in price quality and features are displayed by brand i e each display presents different models of one brand as compared to a display by feature level i e each display presents comparable models of different brands and 3 consumers considering a pair of two option local sets each consisting of different brands and feature levels e g a feature enhanced model of a low quality brand vs a basic model of a high quality brand are more likely to select a feature enhanced model from the global set of four options than those who consider the same alternatives in other local set configurations or consider only the global set these predictions were supported in seven studies which also provided insights into the boundaries of the effects focusing on the paired comparison effect we discuss the theoretical and practical implications of the findings

why do poor people co hold debt and liquid savings i examine the use of flexible savings and loan accounts offered by safesave a microfinance institution serving poor slum dwellers in dhaka bangladesh i find that 59 per cent of the clients co ho

what are the headwaters of formal savings experimental evidence from sri lanka the world s poor are seeing a rapid expansion in access to formal savings accounts what is the source of savings when households are connected to a formal account we combine a high frequency panel survey spanning two and a half years with an experiment in which a sri lankan bank used mobile point of service pos terminals to collect deposits directly from households each week we find that the headwaters of formal savings lie in sacrificed leisure time households work more and improved savings options generate an increase in labour effort in both self employment and in the wage market the results suggest that the labour allocation channel is an important mechanism linking savings opportunities to income

theoretical comparisons of electoral systems abstract elements of an economic theory of political institutions are introduced a variety of electoral systems are reviewed cox s threshold is shown to measure incentives for diversity and specialization of candidates positions when the number of serious candidates is given duverger s law and its generalizations are discussed to predict the number of serious candidates duverger s law is interpreted as a statement about electoral barriers to entry and this idea is linked to the question of the effectiveness of democratic competition as a deterrent to political corruption the impact of post electoral bargaining on party structure in presidential and parliamentary systems is discussed

analysis of renewable energies in european union abstract the paper s main research objective is to analyse the renewable energy sector in the european union member states the first step of the research was to generate clusters of countries based on the share of renewables in total energy produced and the countries energy dependence in order to generate the clusters we applied the k means clustering method based on the data obtained from eurostat by using the statistical package for the social sciences three clusters of countries have been generated in the next step the eu states were ranked based on the following criteria share of renewable energy sources share of renewable electricity share of renewable heating and cooling and share of renewable energy in transport then the main characteristics of the renewable energy policy in each member state have been highlighted

money talks deterring quality challengers in congressional elections j 4t e examine the role of incumbent fundraising in deterring strong challengers we construct vf v a signaling model in which incumbents can use fundraising strategically to ward off w v quality challengers we show however that only under very limited circumstances will there be an observable relationship between fundraising and challenger quality therefore previous empirical tests for deterrence have systematically underestimated the effects of fundraising in decreasing electoral competition our analysis also suggests that by making fundraising easily observable federal election commission regulations may encourage candidates to overinvest time and resources accumulating large war chests instead of governing

implementing the borda outcome via truncated scoring rules a computational study this study is an attempt to empirically understand the likelihood of choosing the borda outcome through a truncated scoring rule when n voters are asked to report only part of their linear preferences over m alternatives we run monte carlo simulations through a grid search algorithm as we employ an impartial culture model to sample voters preferences given the range of parameter values we consider we report the truncated scoring rules that maximize the likelihood of implementing the borda outcome and how the maximum likelihood changes with m and n we also present our results on the relative performances of some popular truncated voting rules such as plurality and approval voting in implementing the borda outcome and demonstrate that two level approval voting performs significantly better than the plurality rule moreover we propose the expected borda rule as a good proxy for the best implementor of the borda rule among all truncated rules

decision theory the next 100 years advances in decision theory have often been driven by paradoxes early in the eighteenth century daniel bernoulli and others wrestled with why prudent individuals often violate the principle of maximising expected return they were fascinated by the paradox of people paying at most a few pounds to engage in an infinite expectation game that returns 2 shillings if the first heads in a succession of coin tosses occurs at toss n later in the same century the marquis de condorcet was intrigued by the paradox of cyclical majorities for multicandidate elections in which there is no majority candidate who could defeat or tie every other candidate under simple majority comparisons based on voter preference rankings bernoulli s i 738 resolution of the prudent people paradox was an early version of expected utility theory in which one s utility for money increases at a decreasing rate his legacy is evident in later expected utility theories as well as the principle of diminishing marginal utility of wealth that was so popular

the influence of serotonin deficiency on choice deferral and the compromise effect abstractpsychological and physiological states such as mood hunger stress and sleep deprivation are known to affect decision making processes and therefore crucially influence consumer behavior a possible biological mechanism underlying the observed variability of consumer behavior is the context sensitive variation in the levels of neuromodulators in the brain in a series of four experimental studies the authors pharmaceutically reduce the levels of the neurotransmitter serotonin in the brain to diminish the availability of subjects cognitive resources in doing so they study how serotonin brain levels influence 1 subjects tendency to avoid buying and 2 consumers preference for product options positioned as a compromise in a given choice set rather than for more extreme alternatives i e the compromise effect using realistic product choice scenarios in a binding decision framework they find that a reduction of brain serotonin levels leads to choice deferral and decreases the compromise

search costs and adaptive consumers short time delays do not affect choice quality using online price comparison and shopping platforms makes experiencing slow connections lags and waiting times for information an unfortunate reality however little attention has been paid to analyzing the effects of such delayed display of information on product choice behavior this article explores the effect of time delays in a multi attribute choice laboratory experiment by not providing information immediately when requested but after short time delays increasing these waiting times reduced the amount of information looked up but did not affect choice quality higher time delays made decision makers use more deliberate search processes whereas low time delays induced inefficient over searching

incumbent performance and electoral control in the pure theory of electoral competition citizens compare the platforms of the candidates and vote for the one whose platform is preferred candidate strategies are identified with promises about future performance in office models of this sort have been developed in both static mckelvey 1975 and dynamic kramer 1977 i settings and all appear to have the property that if the set of alternatives is large enough in some sense equilibrium platforms rarely exist but these models have another feature that is quite as disturbing as their instability in the static setting discussed by mckelvey little attention is paid to the possibility that once in office the politician s preferences may diverge from those of his constituents and that he may therefore choose policies at variance from his platform instead it is simply assumed that promises will be kept whether or not such behavior is congruent with the interest of the officeholder it is sometimes argued that an enforcement mechanism may exist to discipline politicians for failing to keep promises but without a specification of the mechanism it is not obvious that it would be in the interests of the

why did the incumbency advantage in u s house elections grow theory a simple rational entry argument suggests that the value of incumbency consists not just of a direct effect reflecting the value of resources such as staff attached to legislative office but also of an indirect effect reflecting the fact that stronger challengers are less likely to contest incumbent held seats the indirect effect is the product of a scare off effect the ability of incumbents to scare off high quality challengers and a quality effect reflecting how much electoral advantage a party accrues when it has an experienced rather than an inexperienced candidate hypothesis the growth of the overall incumbency advantage was driven principally by increases in the quality effect methods we use a simple two equation model estimated by ordinary least squares regression to analyze u s house election data from 1948 to 1990 results most of the increase in the incumbency advantage at least down to 1980 came through increases in the quality effect i e the advantage to the incumbent party of having a low quality challenger this suggests that the task for those wishing to explain the growth in the vote denominated incumbency advantage is to explain why the quality effect grew it also suggests that resource based explanations of the growth in the incumbency advantage cannot provide a full explanation

challenger entry and voter learning we develop a model of strategic interaction between voters and potential electoral challengers to sitting incumbents in which the very fact of a costly challenge conveys relevant information to voters given incumbent failure in office challenger entry is more likely but the threat of entry by inferior challengers creates an incentive for citizens to become more politically informed at the same time challenges to incumbents who perform well can neutralize a voter s positive assessment of incumbent qualifications how a voter becomes politically informed can in turn deter challengers of different levels of competence from running depending on the electoral environment the model permits us to sharpen our understanding of retrospective voting the incumbency advantage and the relationship between electoral competition and voter welfare while pointing to new interpretations of and future avenues for empirical research on elections

learning about voter rationality we model the accountability relationship between voters and politicians to clarify what can and can t be learned about voter rationality from existing evidence from the behavior literature we make two key points first we show that evidence on the electoral consequences of natural disasters and economic shocks typically interpreted as evidence for voter irrationality is consistent with a canonical model with rational voters second we show that the evidence on the electoral consequences of disaster response typically interpreted as evidence for voter rationality is consistent with the same model with irrational voters hence neither body of evidence can adjudicate between rational and irrational voting behavior we also derive new hypotheses that can better guide future empirical work attempting to assess voter rationality

a model of political competition with citizen candidates the authors develop a model of electoral competition in which citizens choose whether or not to run as candidates a winner implements her favorite policy the equilibrium number of candidates depends negatively on the cost of running and positively on the benefits of winning for some parameter values all equilibria under plurality rule have exactly two candidates whose positions are distinct two candidate elections are more likely under plurality rule than under a runoff system the candidates positions are less differentiated under a runoff system there exist equilibria under both systems in which some candidates have no chance of winning

fiscal consequences of electoral institutions abstract there are more than 500 000 elected local government officials in the united states the most electorally dense county has more than 20 times the average number of elected officials per capita this paper offers the first systematic investigation of the link between electoral density and fiscal outcomes electoral density presents a tradeoff between accountability and monitoring costs increasing the number of specialized elected offices promotes issue unbundling reducing slack between citizen preferences and government policy but the costs of monitoring a larger number of officials may offset these benefits producing greater latitude for politicians to pursue their own goals at the expense of citizen interests we predict diminishing returns to electoral density and a documentclass aastex usepackage amsbsy usepackage amsfonts usepackage amssymb usepackage bm usepackage mathrsfs usepackage pifont usepackage stmaryrd usepackage textcomp usepackage portland xspace usepackage

behavioral foundations of microcredit experimental and survey evidence from rural india microcredit is an innovative financial tool designed to reduce poverty and fix credit market imperfections we use experimental measures of time discounting and risk aversion for villagers in south india to highlight behavioral features of microcredit conditional on borrowing from any source women with present biased preferences are more likely than others to borrow through microcredit institutions microcredit contracts require loan repayments in regular fixed installments and they harness peer pressure to encourage discipline these innovations mirror mechanisms highlighted in behavioral approaches to saving suggesting that microcredit s popularity stems partly from modes of encouragement and self discipline absent in typical lending mechanisms

strategic voting equilibria under the single nontransferable vote previous investigations of strategic voting equilibria in mass electorates have looked only at single member districts i shall investigate such equilibria in multimember districts operating under the single nontransferable vote system what appear to be the most natural equilibria conform to the m 1 rule according to which strategic voting in m seat districts produces exactly m 1 vote getting candidates in equilibrium any others having their support totally undercut this result provides the beginnings of a formal underpinning for reed s recent extension of duverger s law to the japanese case the model also generates specific and empirically testable hypotheses concerning the exceptions to the m 1 rule that one ought to expect in equilibrium i test these hypotheses with japanese data finally the model also reveals a type of strategic voting that is specific to multimember districts i use japanese data again to explore the empirical importance of this kind of strategic voting

a model of candidate location when one candidate has a valence advantage that under some fairly weak assumptions for all levels of the valence advantage the advantaged candidate chooses a more moderate position than the disadvantaged candidate empirical studies of congressional elections by fiorina 1973 and ansolabehere snyder and stewart 2001 support this result d owns 1957 seminal work presents a puzzle for scholars of u s elections why do candidates not converge to the median voter one of the best explanations is that the candidates themselves have ideological preferences as calvert 1985 and wittman 1977 1983 have shown when candidates have such preferences and they are sufficiently uncertain about the preferences of the median voter then they do not converge although they may moderate their positions from their ideal point the basic version of the calvert wittman model however does not account for another basic fact of u s elections often one of the candidates has an advantage due to a nonpolicy factor such as incumbency greater campaign funds better name recognition superior charisma superior intelligence and so on stokes has dubbed such factors valence factors and he has noted their importance in u s elections stokes 1963 1992 1 in this article i extend the basic calvert wittman model by giving one candidate a valence advantage over the other i show that if the valence characteristics of the candidates are approximately equal then when a candidate s valence advantage increases this causes her to move toward the

prompting microfinance borrowers to save a field experiment from guatemala abstractcan microfinance borrowers use the discipline of regular loan repayments in order to accumulate savings if prompted to do so in an experiment we offered commercial savings products to the microfinance borrowers of guatemala s largest public sector bank we find that giving these borrowers the opportunity to develop a savings plan and be reminded of saving at the time of loan repayment caused no increase in the opening of savings accounts but led to balances among savers that were two and a half times those in the control a second treatment arm that proposed a default savings contribution of 10 of the loan payment caused the fraction of clients using linked savings accounts to double as well as elevated deposits among savers leading to final savings balances that were more than five times the control the savings treatments also generate faster pay down of debt and weakly better overall repayment performance suggesting that simultaneous saving and borrowing can be complementary activities a

choice and procrastination author s o donoghue ted rabin matthew abstract recent models of procrastination due to self control problems assume that a procrastinator considers just one option and is unaware of her self control problems we develop a model where a person chooses from a menu of options and is partially aware of her self control problems this menu model replicates earlier results and generates new ones a person might forego completing an attractive option because she plans to complete a more attractive but never to be completed option hence providing a non procrastinator additional options can induce procrastination and a person may procrastinate worse pursuing important goals than unimportant ones

would rational voters acquire costly information abstract we analyze an election in which voters are uncertain about which of two alternatives is better for them voters can acquire some costly information about the alternatives in agreement with downs s rational ignorance hypothesis individual investment in political information declines to zero as the number of voters increases however if the marginal cost of information is near zero for nearly irrelevant information there is a sequence of equilibria such that the election outcome is likely to correspond to the interests of the majority for arbitrarily large numbers of voters thus rationally ignorant voters are consistent with a well informed electorate

media influence on vote choices unemployment news and incumbents electoral prospects how does news about the economy influence voting decisions we isolate the effect of the information environment from the effect of change in the underlying economic conditions themselves by taking

ameliorating majority decisiveness through expression of preference intensity in pairwise voting when a simple majority rule produces a winner that winner is robust to the minority s preferences the typical means of protecting the minority from the decisiveness of the majority is by increasing the required majority or by augmenting the simple majority rule with constitutional constraints in the former case the required majority q becomes larger than one half and this implies that the q majority rule becomes biased in favor of one of the alternatives usually the status quo in the latter case the augmented rule becomes biased in favor of the minority the main issue examined in this paper is whether the amelioration of majority decisiveness can be attained by unbiased voting rules that allow some restricted expression of preference intensities our results clarify that the use of scoring rules provides a positive answer to the above question when voters resort to variable degrees of coordinated strategic voting the results are illustrated in the special cases of the plurality and the borda rules

exchangeability and its economic applications abstract the symmetry possessed by exchangeability is the key to its usefulness the methods that are used to comprehend reality will edify insofar as they reflect this symmetry this is true of theoretical models empirical methods and algorithms indeed if the design of mechanisms is by rearrangement of natural matter their survival value will depend on the degree to which they retain the symmetry of the original matter this comment encompasses complex machinery and sophisticated political social and economic institutions the paper simply embroiders this observation

barriers to formal saving micro and macroeconomic effects this paper examines different barriers to formal saving considering various interventions and their possible effects at microeconomic and macroeconomic levels it presents a comprehensive review of the literature based on a detailed classification of the barriers associated with supply side factors related to access to financial products and demand side barriers related to the use and frequency of use of those products the paper concludes that this classification and analysis contributes to a fuller understanding of the question of financial inclusion and how to achieve it

pretending to be poor borrowing to escape forced solidarity in cameroon abstractfrom field observations of credit cooperatives in cameroon we find that 19 of the loans taken are fully collateralized by savings held in the same institutions this behavior is costly to the borrower as it represents a net interest payment of about 24 per year while traditional explanations may partly explain this behavior interviews with members of the cooperatives suggest the following new rationale members resort to borrowing to signal to friends and relatives that they are poor and do not have savings available by doing so they can avoid requests for financial help we develop a signaling model to analyze the conditions under which this behavior is an equilibrium outcome

the borda rule is also intended for dishonest men this paper examines the welfare consequences of strategic voting under the borda rule in a comparison of utilitarian efficiencies in simulated voting games under two behavioural assumptions expected utility maximising behaviour and sincere behaviour utilitarian efficiency is higher in the former than in the latter strategic voting increases utilitarian efficiency particularly if the distribution of preference intensities correlates with voter types the borda rule is shown to have two advantages strategic voting is beneficial even if some but not all voter types engage in strategic behaviour and even if the voters information is based on unreliable signals

when and how do voters try to manipulate experimental evidence from borda elections we study strategic voting in a laboratory experiment using a borda mechanism we find that manipulation rates are surprisingly low even for individuals who know that they possess superior information about the other agents preferences exploring possible explanations we find that manipulation rates rise significantly if individuals are not only informed about the other agents preferences but also about their actual votes this suggests that uncertainty plays a key role in understanding strategic behavior in elections by contrast distributional concerns e g in the form of inequality aversion are found to play a negligible role in our context

on the theory of strategic voting many analyses of plurality rule elections predict the complete coor dination of strategic voting and hence support for only two candidates here i suggest that stable multi candidate support will arise in equilibrium a group of voters must partially coordinate behind one of two challenging candidates in order to dislodge a disliked incumbent in a departure from existing models the popular support for each challenger is uncertain this support must be inferred from the private observation of informative signals such as the social communication of pref erences throughout the electorate or the imperfect observation of opinion polls the uniquely stable voting equilibrium entails only limited strategic voting and hence incomplete coordination this is due to the surprising presence of negative feed back an increase in the degree of strategic voting by others reduces the incentives for an individual to vote strategically the incentive to vote strategically is lower in relatively marginal elections after controlling for the distance from contention of a trailing preferred challenger a calibration of the model applied to the uk general election of 1997 is consistent with the impact of strategic voting and the reported accuracy of voters understanding of the electoral situation it suggests that nearly 50 seats may have been lost by the conservative party due to strategic voting 1 plurality rule elections and strategic voting 1 1 strategic voting and duverger s law plurality rule elections where the winner is the candidate who receives the largest number of votes are vulnerable to strategic voting a voter might well switch away from her preferred candidate and toward a perceived leader in the hope of exerting a greater influence over the outcome of the election this phenomenon has long been the focus of both economic and political scientific study in an influential essay riker 1982b cited droop s 1871 eloquent exposition of the strategic voting problem 1 i oer my grateful thanks to the many friends colleagues seminar participants referees and editors who have oered insightful comments during the long gestation of this paper its antecedents and companion work special thanks go to steve fisher whose empirical analysis of strategic voting raised many of the questions that i seek to answer in this paper and to chris wallace this particular paper brings together much of the analysis previously circulated in the papers a new theory of strategic voting strategic voting under the qualified majority rule and idiosyncrasy information and the impact of strategic voting

evaluationwise strategy proofness abstract we consider manipulation of collective decision making rules in a framework where voters not only rank candidates but also evaluate them as acceptable or unacceptable in this richer informational setting we adopt a new notion of strategy proofness called evaluationwise strategy proofness where incentives of manipulation exist if and only if a voter can replace an outcome which he finds unacceptable with an acceptable one evaluationwise strategy proofness is weaker than strategy proofness however we establish the prevalence of a logical incompatibility between evaluationwise strategy proofness anonymity and efficiency on the other hand we show possibility results when either anonymity or efficiency is weakened

democratic accountability and retrospective voting a laboratory experiment understanding the incentives of politicians requires understanding the nature of voting behavior i conduct a laboratory experiment to investigate whether voters focus on the problem of electoral selection or if they instead focus on electoral sanctioning if voters are forward looking but uncertain about politicians unobservable characteristics then it is rational to focus on selection but doing so undermines democratic accountability because selection renders sanctioning an empty threat in contrast to rational choice predictions the experimental results indicate a strong behavioral tendency to use a retrospective voting rule additional experiments support the interpretation that retrospective voting is a simple heuristic that voters use to cope with a cognitively difficult inference and decision problem and in addition suggest that voters have a preference for accountability the results pose a challenge for theories of electoral selection and voter learning and suggest new interpretations of empirical studies of economic and retrospective voting

tying odysseus to the mast evidence from a commitment savings product in the philippines we designed a commitment savings product for a philippine bank and implemented it using a randomized control methodology the savings product was intended for individuals who want to commit now to restrict access to their savings and who were sophisticated enough to engage in such a mechanism we conducted a baseline survey on 1777 existing or former clients of a bank one month later we offered the commitment product to a randomly chosen subset of 710 clients 202 28 4 percent accepted the offer and opened the account in the baseline survey we asked hypothetical time discounting questions women who exhibited a lower discount rate for future relative to current trade offs and hence potentially have a preference for commitment were indeed significantly more likely to open the commitment savings account after twelve months average savings balances increased by 81 percentage points for those clients assigned to the treatment group relative to those assigned to the control group we conclude that the savings response represents a lasting change in savings and not merely a short term response to a new product

intrinsic variability in group and individual decision making the paper examines the random preference model which can explain inherent variability of preferences in managerial and individual decision making and provides axiomatizations for the utility components of two such models differentiated by the structure of core preferences expected utility eu and betweenness like preferences we then examine the possibility of violations of weak stochastic transitivity for these models and for a model with core dual eu preferences such violations correspond to the existence of condorcet cycles and therefore the analysis has implications for managerial decision making and for majority rule voting the paper also investigates implications of its findings for two popular experimental settings this paper was accepted by james smith decision analysis

an analysis of congressional career decisions 1947 1986 most previous research on congressional career decisions has focused on one of two binary choices between retiring and running for reelection or between running for reelection and seeking higher office but most of the time representatives face all three choices simultaneously employing a mother logit model we estimate the effects of relevant variables both on pairwise comparisons conditional probabilities and on the unconditional probabilities of choosing each one of these three alternatives probably most intriguing is our finding that a member s age has little or no effect upon the unconditional probability of running for reelection the interrelatedness of career options is seen particularly clearly in the case of incumbents who had been redistricted out of their seats when they had an opportunity to run for higher office they were likely to take it only when they lacked such an opportunity were they more likely than other members to opt for retirement

100 bills on the sidewalk suboptimal investment in 401 k plans we identify employees at seven companies whose 401 k investment choices are dominated because they are contributing less than the employer matching contribution threshold despite being vested in their match and being able to make penalty free 401 k withdrawals for any reason because they are older than 59 at the average firm 36 of match eligible employees over 59 forego arbitrage profits that average 1 6 of their annual pay or 507 a survey educating employees about the free lunch they are foregoing raised contribution rates by a statistically insignificant 0 67 percent of income among those completing the survey

optimal conflict in preference assessment conflict arises indecision making when the choice alternatives present strong advantages and disadvantages over one another that is when the trade offs involved are large conflict affects human response to choice in particular it increases decision difficulty and response unreliability on the other hand larger trade offs i e higher conflict reveal more information about an individual s preferences and mitigate the influence of measurement unreliability on preference model estimation this suggests somewhat counterintuitively that there may exist some optimal level of conflict for efficient measurement of preferences how to determine this level this issue is examined from behavioral and analytical angles we outline a general analysis of the interaction between trade off size and modeling accuracy and demonstrate its application on a simple example the kind of analysis developed here can be conveniently implemented in a computer spreadsheet and would be especially valuable when large amounts of preference data are to be collected as in consumer preference studies experimental research and contingent valuation surveys

the responsiveness of approval voting comments on saari and van newenhizen saari and van newenhizen 1987 misinterpret their findings about the indeterminacy of voting systems far from being a vice indeterminacy is a virtue in allowing voters to be more responsive to and robbing them of the incentive to misrepresent their preferences the responsiveness of approval voting in particular means that the cardinal utilities that voters have for candidates can be reflected in voters strategy choices which ultimately translate into better social choices empirical data from a recent election support these claims showing among other things that the borda system a determinate voting system favored by saari and van newenhizen is highly vulnerable to manipulation by strategic voters

quality counts extending the strategic politician model of incumbent deterrence competitive elections are essential to representative democracy competition in u s house elections is low in part because incumbents have strategic advantages that deter strong potential candidates from running many observers conclude that incumbents retain their seats without full accountability to the electorate but the mechanisms of deterrence have never been fully explored from the perspective of strong potential candidates based on a survey of potential house candidates designed to capture perceptions of incumbents personal quality and reelection prospects we find strong evidence for the strategic politicians thesis black 1972 jacobson and kernell 1983 we extend the logic of the strategic model first by showing that incumbents reelection prospects are affected by their personal quality and second by demonstrating that incumbents personal qualities deter strong challengers from running independent of their electoral prospects our findings prompt us to suggest revisions to our understanding of competition and representation in contemporary house elections

using multimember district elections to estimate the sources of the incumbency advantage in this article we use a novel research design that exploits unique features of multimember districts to estimate and decompose the incumbency advantage in state legislative elections like some existing related studies we also use repeated observations on the same candidates to account for unobserved factors that remain constant across observations multimember districts have the additional feature of copartisans competing for multiple seats within the same district this allows us to identify both the direct office holder benefits and the incumbent quality advantage over nonincumbent candidates from the same party we find that the overall incumbency advantage is of similar magnitude as that found in previous studies we attribute approximately half of this advantage to incumbents quality advantage over open seat candidates and the remainder to direct office holder benefits however we also find some evidence that direct office holder benefits are larger in competitive districts than in safe districts and in states with relatively large legislative budgets per capita