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Risk Aversion, Over-Confidence and Private Information as determinants of Majority Thresholds

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  • Giuseppe Attanasi
  • Luca CORAZZINI
  • Nikolaos GEORGANTZIS
  • Francesco PASSARELLI

Abstract

We present and experimentally test a theoretical model of majority threshold determination as a function of voters' risk preferences. The experimental results confirm the theoretical prediction of a positive correlation between a voter's risk aversion and the corresponding preferred majority threshold. Furthermore, the experimental results show that a voter's optimal majority threshold negatively relates to the voter's confidence about how others will vote. Moreover, in a treatment in which individuals receive a private signal about others' voting behavior, the private signal tends to replace confidence.

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Paper provided by LERNA, University of Toulouse in its series LERNA Working Papers with number 09.26.302.

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Date of creation: Dec 2009
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Handle: RePEc:ler:wpaper:09.26.302

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  16. Harrington, Joseph E, Jr, 1990. " The Role of Risk Preferences in Bargaining When Acceptance of a Proposal Requires Less than Unanimous Approval," Journal of Risk and Uncertainty, Springer, vol. 3(2), pages 135-54, June.
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