Risk Aversion, Over-Confidence and Private Information as Determinants of Majority Thresholds

Giuseppe Attanasi, Luca Corazzini, Nikolaos Georgantzis, Francesco Passarelli.
Authors registered in the RePEc Author Service: Nikolaos Georgantzís (), Giuseppe Attanasi, Luca Corazzini and Francesco Passarelli

No 34, ISLA Working Papers from ISLA, Centre for research on Latin American Studies and Transition Economies, Universita' Bocconi, Milano, Italy

Abstract: We present and experimentally test a theoretical model of majority threshold determination as a function of voters' risk preferences. The experimental results confirm the theoretical prediction of a positive correlation between a voter's risk aversion and the corresponding preferred majority threshold. Furthermore, the experimental results show that a voter's optimal majority threshold negatively relates to the voter's confidence about how others will vote. Moreover, in a treatment in which individuals receive a private signal about others' voting behavior, the private signal tends to replace confidence.

Keywords: majority threshold; risk aversion; (over-)confidence; laboratory experiment. (search for similar items in EconPapers)
JEL-codes: C91 D72 D81 H11 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2009-10
New Economics Papers: this item is included in nep-cbe, nep-cdm, nep-exp and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Working Paper: Risk Aversion, Over-Confidence and Private Information as determinants of Majority Thresholds (2009)
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