Book contents
- Frontmatter
- Contents
- Preface
- Acknowledgments
- Part I The Formative Years
- Part II Institutions and Market Performance
- Part III Public Goods
- Introduction
- 20 The Principle of Unanimity and Voluntary Consent in Social Choice
- 21 Incentive Compatible Experimental Processes for the Provision of Public Goods
- 22 An Experimental Comparison of Three Public Good Decision Mechanisms
- 23 Experiments with a Decentralized Mechanism for Public Good Decisions
- 24 Experimental Tests of an Allocation Mechanism for Private, Public or Externality Goods
- Part IV Auctions and Institutional Design
- PART V Industrial Organization
- Part VI Perspectives on Economics
20 - The Principle of Unanimity and Voluntary Consent in Social Choice
Published online by Cambridge University Press: 06 July 2010
- Frontmatter
- Contents
- Preface
- Acknowledgments
- Part I The Formative Years
- Part II Institutions and Market Performance
- Part III Public Goods
- Introduction
- 20 The Principle of Unanimity and Voluntary Consent in Social Choice
- 21 Incentive Compatible Experimental Processes for the Provision of Public Goods
- 22 An Experimental Comparison of Three Public Good Decision Mechanisms
- 23 Experiments with a Decentralized Mechanism for Public Good Decisions
- 24 Experimental Tests of an Allocation Mechanism for Private, Public or Externality Goods
- Part IV Auctions and Institutional Design
- PART V Industrial Organization
- Part VI Perspectives on Economics
Summary
A discrete version of the author's incentive-compatible Auction Mechanism for public goods is applied to the problem of social choice (voting) among distinct mutually exclusive alternatives. This Auction Election is a bidding mechanism characterized by (1) unanimity, (2) provision for the voluntary compensation of voters harmed by a winning proposition, and (3) incentives for “reasonable” bidding by excluding members of a collective from maximal increase in benefit if they fail to agree on the proposition with largest surplus. Four of five experiments with six voters, bidding privacy, monetary rewards, and cyclical majority rule structure choose the best of three propositions.
Solutions to the problem of specifying incentive-compatible mechanisms for the provision of public goods have been proposed by Thompson (1965), Groves (1969, 1973), Clarke (1971), Drezeanddela Vallée Poussin (1971), Groves and Ledyard (1975), and Smith (in press a, in press b). Tideman and Tullock (1976) have applied the Clarke-Groves “demand revealing process” to the problem of social choice among discrete alternatives. Several laboratory and field experimental studies of these mechanisms, and of the so-called free-rider problem in public goods, have been conducted by Bohm (1972), Scherr and Babb (1975), the Public Broadcasting Service (reported by Ferejohn and Noll 1976), and Smith (in press b).
- Type
- Chapter
- Information
- Papers in Experimental Economics , pp. 377 - 391Publisher: Cambridge University PressPrint publication year: 1991
- 1
- Cited by