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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 study, both theoretically and experimentally, the relation between preferred majority thresholds and behavioral traits such as the degree of risk aversion and the subjective confidence on others preferences over the alternative to vote. The main theoretical findings are supported by experimental data. The majority threshold chosen by a subject is positively and significantly correlated with her degree of risk aversion while it is negatively and significantly associated to her confidence on others’ votes. Moreover, in a treatment in which each subject can privately observe the distribution of preferences over a sub-group of participants, we find that the quality of information crowds-out subject's confidence.
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  • Giuseppe Attanasi & Luca CORAZZINI & Nikolaos GEORGANTZIS & Francesco PASSARELLI, 2009. "Risk Aversion, Over-Confidence and Private Information as determinants of Majority Thresholds," LERNA Working Papers 09.26.302, LERNA, University of Toulouse.
  • Handle: RePEc:ler:wpaper:09.26.302
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    Cited by:

    1. Giuseppe Attanasi & Nikolaos Georgantzís & Valentina Rotondi & Daria Vigani, 2018. "Lottery- and survey-based risk attitudes linked through a multichoice elicitation task," Theory and Decision, Springer, vol. 84(3), pages 341-372, May.
    2. Marina Bannikova & Artyom Jelnov & Pavel Jelnov, 2021. "The Number of Parties and Decision-Making in Legislatures," Games, MDPI, vol. 12(4), pages 1-10, October.
    3. Daniela Di Cagno & Daniela Grieco, 2019. "Measuring and Disentangling Ambiguity and Confidence in the Lab," Games, MDPI, vol. 10(1), pages 1-22, February.

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    More about this item

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government

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