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Flip a coin or vote? An experiment on the implementation and efficiency of social choice mechanisms

Author

Listed:
  • Timo Hoffmann

    (Friedrich-Alexander Universität Erlangen-Nürnberg (FAU))

  • Sander Renes

    (Collaborative Research Center SFB 884 “Political Economy of Reforms”
    Erasmus University Rotterdam)

Abstract

Corporate boards, experts panels, parliaments, cabinets, and even nations all take important decisions as a group. Selecting an efficient decision rule to aggregate individual opinions is paramount to the decision quality of these groups. In our experiment we measure revealed preferences over and efficiency of several important decision rules. Our results show that: (1) the efficiency of the theoretically optimal rule is not as robust as simple majority voting, and efficiency rankings in the lab can differ from theory; (2) participation constraints often hinder implementation of more efficient mechanisms; (3) these constraints are relaxed if the less efficient mechanism is risky; (4) participation preferences appear to be driven by realized rather than theoretic payoffs of the decision rules. These findings highlight the difficulty of relying on theory alone to predict what mechanism is better and acceptable to the participants in practice.

Suggested Citation

  • Timo Hoffmann & Sander Renes, 2022. "Flip a coin or vote? An experiment on the implementation and efficiency of social choice mechanisms," Experimental Economics, Springer;Economic Science Association, vol. 25(2), pages 624-655, April.
    • Handle: RePEc:kap:expeco:v:25:y:2022:i:2:d:10.1007_s10683-021-09724-9
    DOI: 10.1007/s10683-021-09724-9
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    1. Bol, Damien & Blais, André & Coulombe, Maxime & Laslier, Jean-François & Pilet, Jean-Benoit, 2023. "Choosing an electoral rule: Values and self-interest in the lab," Journal of Economic Psychology, Elsevier, vol. 95(C).

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    More about this item

    Keywords

    Experimental economics; Group choice; Choice rules; Mechanisms; Participation constraints; Individual rationality; Two-stage voting; Bayesian games; Efficiency;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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