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2007 (29) Heft 2

Perspectives on Social Choice


Guest-Editor: Marlies Ahlert

Abstracts | Inhalt | Editorial

Marlies Ahlert
Aspiration Balancing Agreements: A New Axiomatic Approach to Bounded Rationality in Negotiations

Abstract: A wealth of experimental findings on how real actors do in fact bargain exists. However, as long as there is no systematic general account of the several experiments bargaining theory remains dominated by axiomatic approaches based on normative requirements or on assumptions of full rather than bounded rationality. Contrary to that, the new axiomatic account of aspiration level balancing in negotiations of boundedly rational actors presented in this paper incorporates experimental findings systematically into economic bargaining theory. It thereby forms a descriptive theory of bargaining that has normative power as well.

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Nicholas Baigent
Choice, Norms and Revealed Preference

Abstract: This paper considers lexical combinations of choice functions where at least one is interpreted as arising from a norm. It is shown that in for all possibilities in which a norm is present, in general final choice may be consistent with preference optimization, but that it need not be so. It is concluded therefore that a fruitful approach to understanding the effect of norms on choice is to consider particular classes of norms rather than norms in general as in the work by Wulf Gaertner among others.

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Salvador Barberà
Indifferences and Domain Restrictions

Abstract: The purpose of this paper is to discuss the extent to which allowing for individuals to be indifferent among alternatives may alter the qualitative results that are obtained in social choice theory when domain restrictions are defined on profiles of linear orders. The general message is that indifferences require attention and careful treatment, because the translation of results from a world without indifferences to another where agents may be indifferent among some alternatives is not always a straightforward exercise. But the warning is not one-directional: sometimes indifferences complicate the statement of results, but preserve their essential message. Some- times, they help to create domains where some rules work better than in the presence of linear orders. In other cases, however, their presence destroys the positive results that would apply in their absence. I provide examples of these three situations.

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Walter Bossert / Kotaro Suzumura
Non-deteriorating Choice without Full Transitivity

Abstract: Although the theory of greatest-element rationalizability and maximal-element rationalizability on general domains and without full transitivity of rationalizing relations is well-developed in the literature, these standard notions of rational choice are often considered to be too demanding. An alternative definition of rationality of choice is that of non-deteriorating choice, which requires that the chosen alternatives must be judged at least as good as a reference alternative. In game theory, this definition is well-known under the name of individual rationality when the reference alternative is construed to be the status quo. This alternative form of rationality of individual and social choice is characterized inthispaperongeneraldomainsandwithout full transitivity of rationalizing relations.

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Friedrich Breyer / Hartmut Kliemt
The Shortage of Human Organs: Causes, Consequences and Remedies

Abstract: There is an ever increasing shortage of human organ transplants in Germany. This paper aims at understanding the reasons for that shortage better and then discusses various ways to overcome it. After estimating the potential supply of donor organs it is discussed why actual supply remains far below potential supply. Insufficient reimbursement for hospitals, a lack of incentives to donate, and mistaken donation rules are diagnosed to cause the shortage. Thus, organ shortage is due not to natural constraints but to inappropriate social institutions. Introducing a presumed consent rule, reciprocity in organ allocation, better payments for hospitals and for donors seem potential remedies.

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Wolfgang Eichhorn / Manfred Krtscha
Multivariate Lorenz Ma jorization and Heterogeneity Measures: An Axiomatic Approach

Abstract: This work introduces two new curves that are multivariate generalizations of the “classical” Lorenz curve. All data of d-variate distributions can be visualized by drawing these curves in the plane, whereas Koshevoy’s and Mosler’s generalization by a lift zonoid in R^(d+1) can only be drawn for d = 2. The generalizations of the Lorenz curve induce partial orderings of d-variate distributions. Furthermore, two inequality or heterogeneity measures that are consistent with the induced rankings are proposed. They can be considered as new generalizations of the univariate Gini coefficient. For deciding which of the two measures is more appropriate for measuring a sort of convergence concerning different countries of an union or of regions of a country, we establish systems of axioms. Although these systems are reflecting natural properties, several of the axioms are new. Moreover, by means of these axioms well-known inequality measures are tested, too.

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Marc Fleurbaey
Living Standards and Capabilities: Equal Values or Equal Sets?

Abstract: Inspired by Gaertner and Xu (2006), this paper examines the possibility to construct a social ordering over distributions of capability sets, and a measure of the value of individual capability sets, such that perfect equality of sets, across individuals, is preferable to a simple equality of the value of sets. It is shown that this is a rather demanding requirement.

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Dorothea Herreiner / Clemens Puppe
Distributing Indivisible Goods Fairly: Evidence from a Questionnaire Study

Abstract: We report the results of a questionnaire study on the fair distribution of indivisible goods. We collected data from three different sub ject pools, first- and second- year students ma joring in economics, law students, and advanced economics students with some background knowledge of fairness theories. The purpose of this study is to assess the empirical relevance of various fairness criteria such as inequality aversion, the utilitarian principle of maximizing the sum of individual payoffs, the Rawlsian “maximin” principle of maximizing the payoff of the worst-off individual, and the criterion of envy-freeness (in the sense of Foley 1967).

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Eliora van der Hout / Jack Stecher / Harrie de Swart
A Critical Discussion of the Characteristic Properties of List PR and FPTP Systems

Abstract: This paper discusses the characteristic properties of List PR systems and FPTP systems, as given in Hout 2005 and Hout et al. 2006. While many of the properties we consider are common to both systems, it turns out (see Hout 2005) that the British system distinguishes itself by satisfying the district cancel lation property, while the Dutch system distinguishes itself by satisfying consistency and anonymity. For scoring rules, topsonlyness is equivalent to being party fragmentation-proof (see Hout 2005; Hout et al. 2006). One might present this as an argument in favour of requiring topsonlyness. However, we will also give counter-arguments against insisting upon the property of being party fragmentation-proof.

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Jochen Jungeilges
On Chaotic Consistent Expectations Equilibria

Abstract: The notion of consistent expectations equilibria (CEE) as propagated by Hommes/Sorger (1998) is reviewed. Focusing on their example of a chaotic CEE constructed in the context of a cobweb model, it is argued that such an equilibrium is a temporary one. Assuming that an agent—modeled as an individual, versatile in applying the basic tools of linear time-series econometrics—has learned the CEE, I analyze the duration of the time period over which the agent maintains her/his beliefs concerning the perceived law of motion (AR(1)). The analysis based on numerical simulations indicates that the use of techniques rooted in the linear paradigm is sufficient to generate convincing evidence against the underlying perceived law of motion.

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Prasanta K. Pattanaik / Yongsheng Xu
On Measuring Personal Connections and the Extent of Social Networks

Abstract: The notions of personal connection and social networks are key ingredients of the increasingly important concept of social capital in social sciences in general and in economics in particular. This paper discusses the problem of measuring personal connection and the extent of social networks that may exist in a society. For this purpose we develop several conceptual and analytical frameworks. In the process, we axiomatically characterize several measures of personal connection and social networks.

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Ashley Piggins / Maurice Salles
Instances of Indeterminacy

Abstract: This paper is a survey of how economists and philosophers approach the issue of comparisons. More precisely, it is about what formal representation is appropriate whenever our ability to compare things breaks down. We restrict our attention to failures that arise with ordinal comparisons. We consider a number of formal approaches to this problem including one based on the idea of parity. We also consider the claim that the failure to compare things is a consequence of vagueness. We contrast two theories of vagueness; fuzzy set theory and supervaluation theory. Some applications of these theories are described.

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Yongsheng Xu
Norm-Constrained Choices

Abstract: This paper develops a general and unified framework to discuss individual choice behaviors that are constrained by the individual’s internalized norms. We propose a new notion of rationalizablity of a choice function that incorporates such constraints, and axiomatically study several norm-constrained choice behaviors.

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