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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.

Suggested Citation

  • Giuseppe Attanasi, Luca Corazzini, Nikolaos Georgantzis, Francesco Passarelli., 2009. "Risk Aversion, Over-Confidence and Private Information as Determinants of Majority Thresholds," ISLA Working Papers 34, ISLA, Centre for research on Latin American Studies and Transition Economies, Universita' Bocconi, Milano, Italy.
    • Handle: RePEc:slp:islawp:islawp34
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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

    Keywords

    majority threshold; risk aversion; (over-)confidence; laboratory experiment.;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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