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Stable Aggregation of Preferences

Hild, Matthias (2001) Stable Aggregation of Preferences. Social Science Working Paper, California Institute of Technology , Pasadena, CA. (Unpublished) https://resolver.caltech.edu/CaltechAUTHORS:20170807-152622185

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Abstract

We arrive at new conclusions for social choice theory by considering the process in which we refine decision-theoretic models and account for previously irrelevant parameters of a decision situation (cf. Savage's `small worlds'). Suppose that, for each individual, we consider a coarse-grained and a fine-grained decision-theoretic model, both of which are consistent with each other in a sense to be defined. We desire any social choice rule to be stable under refinements in the sense that the group choice based on fine-grained individual models and the group choice based on coarse-grained individual models agree for choices among coarse-grained alternatives. For ex ante aggregation, we find that stability is ubiquitous since it follows from independence of irrelevant alternatives. In ex post aggregation, individuals' utilities are pooled separately from their beliefs before the group's choice function is constructed. We find that any non-exceptional' rule (e.g., any Pareto optimal rule) for ex post aggregation must be unstable. If the rule is, in addition, independent of irrelevant alternatives, we find an infinite series of reversals of binary group choices. We consider applications to risk management and the theory of consensus formation.


Item Type:Report or Paper (Working Paper)
Additional Information:I am grateful to Philippe Mongin for his intuitive explanation of the Ex Ante Homogeneity Theorem and for extensive help with an early draft. I am much indebted to Isaac Levi and Teddy Seidenfeld for their continued help and interest in this paper. I also thank Richard Jeffrey and Mathias Risse. I wish to thank Christ's College, Cambridge for their generous financial and academic support.
Group:Social Science Working Papers
Funders:
Funding AgencyGrant Number
Christ's College, CambridgeUNSPECIFIED
Subject Keywords:consensus formation, ex ante aggregation, ex post aggregation, independence of irrelevant alternatives, refinements, risk management, small worlds, social choice theory
Series Name:Social Science Working Paper
Classification Code:JEL: D63, D71, D81
Record Number:CaltechAUTHORS:20170807-152622185
Persistent URL:https://resolver.caltech.edu/CaltechAUTHORS:20170807-152622185
Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:79869
Collection:CaltechAUTHORS
Deposited By: Jacquelyn Bussone
Deposited On:07 Aug 2017 23:16
Last Modified:03 Oct 2019 18:25

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