Salience and Social Choice
Mark Schneider () and
Jonathan Leland ()
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Mark Schneider: Economic Science Institute, Chapman University and University of Alabama
Working Papers from Chapman University, Economic Science Institute
The axioms of expected utility and discounted utility theory have been tested extensively. In contrast, the axioms of social welfare functions have only been tested in a few questionnaire studies involving choices between hypothetical income distributions. In this note, we conduct a controlled experiment with 100 subjects in the role of social planners that tests ve fundamental properties of social welfare functions to provide a basic test of cardinal social choice theory. We nd that four properties of the standard social welfare functions tested are systematically violated, producing an Allais paradox, a common ratio eect, a framing eect, and a skewness eect in social choice. We also develop a model of salience based social choice which predicts these systematic deviations and highlights the close relationship between these anomalies and the classical paradoxes for risk and time.
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Persistent link: https://EconPapers.repec.org/RePEc:chu:wpaper:19-08
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