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Divided Majority and Information Aggregation: Theory and Experiment

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  • Laurent Bouton
  • Micael Castanheira De Moura
  • A. Llorente-Saguer

Abstract

This paper both theoretically and experimentally studies the properties of plurality and approval voting when the majority is divided as a result of information imperfections. The minority backs a third alternative, which the majority views as strictly inferior. The majority thus faces two problems: aggregating information and coordinating to defeat the minority candidate. Two types of equilibria coexist under plurality: either voters aggregate information, but this requires splitting their votes, or they coordinate but cannot aggregate information. With approval voting, expected welfare is strictly higher, because some voters multiple vote to achieve both goals at once. In the laboratory, we observe both types of equilibrium under plurality. Which one is selected depends on the size of the minority. Approval voting vastly outperforms plurality. Finally, subject behavior suggests the need to study asymmetric equilibria.

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Bibliographic Info

Paper provided by ULB -- Universite Libre de Bruxelles in its series ULB Institutional Repository with number 2013/136800.

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Date of creation: 2012
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Publication status: Published in: Discussion paper series - Centre for Economic Policy Research (2012)
Handle: RePEc:ulb:ulbeco:2013/136800

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  1. César Martinelli, 2002. "Simple plurality versus plurality runoff with privately informed voters," Social Choice and Welfare, Springer, vol. 19(4), pages 901-919.
  2. Marco Battaglini & Rebecca B. Morton & Thomas R. Palfrey, 2008. "Information Aggregation and Strategic Abstention in Large Laboratory Elections," American Economic Review, American Economic Association, vol. 98(2), pages 194-200, May.
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  8. Santiago Oliveros, 2013. "Aggregation of endogenous information in large elections," Economics Discussion Papers 733, University of Essex, Department of Economics.
  9. Bouton, Laurent & Castanheira, Micael, 2008. "One Person, Many Votes: Divided Majority and Information Aggregation," CEPR Discussion Papers 6695, C.E.P.R. Discussion Papers.
  10. Castanheira, Micael, 2002. "Why Vote for Losers?," CEPR Discussion Papers 3404, C.E.P.R. Discussion Papers.
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  18. Piketty, Thomas, 2000. "Voting as Communicating," Review of Economic Studies, Wiley Blackwell, vol. 67(1), pages 169-91, January.
  19. Laurent Bouton & Gabriele Gratton, 2013. "Majority Runoff Elections: Strategic Voting and Duverger's Hypothesis," Discussion Papers 2013-23, School of Economics, The University of New South Wales.
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  24. Rachel Croson & James Sundali, 2005. "The Gambler’s Fallacy and the Hot Hand: Empirical Data from Casinos," Journal of Risk and Uncertainty, Springer, vol. 30(3), pages 195-209, May.
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Cited by:
  1. Martin Gregor, 2013. "The Optimal Ballot Structure for Double-Member Districts," CERGE-EI Working Papers wp493, The Center for Economic Research and Graduate Education - Economic Institute, Prague.

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