On Thu, 5 Sep 2002, Fred Foldvary wrote: > > Each voter writes down $5 million, the project is undertaken, and social > > loss of $85 per voter follows. > > Eric > > If a voter writes down $5 million, he is declaring that the project is worth > far more to him than the $100 cost he will have to pay.
But he's lying!! > He is willing to pay the $100, so what basis is there in concluding that > there is a loss per voter? The demand has been revealed by the voters' > statements. If they just feel good about having stated that, then it was > worth $100 to feel good about it. He takes the payment of the $100 as totally exogenous. No matter what he bids, he'll either have to pay the hundred dollars or not pay it. So, ignore the $100 and get the expressive benefits. NOthing the voter can do will affect whether or not he pays the $100. The expressive benefits specified in the example were $5. But, it's still rational to state the $5 million preference since the vote doesn't change the outcome and since the bid gets him the expressive benefit. > I don't see why this would be less efficient than simply taking a majority > vote, and the majority voting "yes" because they feel good about it. Demand > revelation is not perfect, but it is more efficient than simple majority > voting. If there is any inefficiency, it is collective democracy itself that > is at fault, not the method of social choice. Because the expressive votes are accorded more aggregate weight under DRP than under regular voting. Suppose that the degree of expressive benefits accorded to an individual for expressing a preference is distributed across a continuum of voters. Under regular voting, the people with the highest expressive benefits get as much say as people with low expressive benefits (whose stated preferences will be closer to their instrumental preferences). Under DRP, the preferences of those with the strongest expressive preferences are the ones accorded the most weight. While no voter is decisive individually, the collective failure under DRP can then be massive. If anybody voting instrumentally would never bid more than a few thousand dollars for one outcome rather than another, but expressive voters throw in bids hitting the millions of dollars, the preferences of the more "rational" voters are swamped far more quickly than under regular voting. To the extent that expressive preferences diverge from instrumental preferences, outcomes will be worse. Eric Crampton > > Fred Foldvary > > > ===== > [EMAIL PROTECTED] > > >
