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

Listed author(s):
  • Giuseppe Attanasi, Luca Corazzini, Nikolaos Georgantzis, Francesco Passarelli.

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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File URL: ftp://ftp.unibocconi.it/pub/RePEc/slp/papers/islawp34.pdf
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Paper provided by ISLA, Centre for research on Latin American Studies and Transition Economies, Universita' Bocconi, Milano, Italy in its series ISLA Working Papers with number 34.

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Length: 31 pages
Date of creation: Oct 2009
Handle: RePEc:slp:islawp:islawp34
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