[Show abstract][Hide abstract] ABSTRACT: Manfred Holler introduced the Public Good index as a proposal to divide a
public good among players. In its unnormalized version, i.e., the raw measure,
it counts the number of times that a player belongs to a minimal winning
coalition. Unlike the Banzhaf index, it does not count the remaining winning
coalitions in which the player is crucial. Holler noticed that his index does
not satisfy local monotonicity, a fact that can be seen either as a major
drawback or as an advantage.
[Show abstract][Hide abstract] ABSTRACT: We identify a novel distortive effect of supermajoritarian voting rules such as qualified majority, filibuster or unanimity. Under such rules, different voters become pivotal under different status quos. If policies are continuing in nature and a changing environment creates the need for renegotiation, legislators distort their voting behavior in favor of alternatives that make them pivotal in the future. As a result, players disagree more often, and the policy is less responsive to the environment. We show that the voting distortions are bigger, the greater the supermajoritarian requirement. The distortions generated by supermajoritarian requirements are larger when the environment is volatile.
In the last decades, multiple U.S. states have passed constitutional amendmends that require a qualified majority to increase taxes. Arguably, these amendments are designed to reduce spending and tax levels. Our results imply that such amendments can severely limit the states' ability to adjust taxation throughout the business cycle. We also show that they can even fail to achieve their primary goal of keeping taxes low.
[Show abstract][Hide abstract] ABSTRACT: How does the structure of the economy affect the possibility for societal stability? This paper employs a cooperative game theory lens to explore possibilities for cooperation and chaos under various growth scenarios and assumptions of distributional equality in a hypothetical 2-sector economy (industrialists and agriculturalists). It suggests that maintaining distributional equality amongst agriculturalists is only undesirable under the assumption that the manufacturing sector exhibits positive and decreasing returns to scale; if increasing or negative manufacturing returns are the case, agricultural equality becomes an important policy goal in maintaining stability. In the particular case of a shrinking economy, peace can be preserved given (a) fairly equitable land distribution, and (b) a healthy industrial sector serving agriculture. In terms of aid policy, I suggest that, under decreasing industrial returns, more resources available to an economy can promote cooperative frameworks, but that such boosts will entail a switch to economies structured around the industrial sector. I conclude with a suggestion for testing the model.
Stability: International Journal of Security and Development. 01/2013; 2(2):1-19.
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