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    Collective decisions are made through several actors and processes: - Citizen voters make decisions through majority rule voting and by pressuring politicians through activism as individuals or members of interest groups. However, majority rule is problematic according to Arrow's Impossibility Theorem and may not reflect preferences accurately. - Special interest and public interest groups influence outcomes through organizing, lobbying, and applying pressure. - Politicians in the legislature and executive branch make laws, policies, and administrative decisions, while the judicial system also plays a role. Bureaucratic agencies also influence outcomes.

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    07 CH 6.pdfNotes

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    Collective decisions are made through several actors and processes: - Citizen voters make decisions through majority rule voting and by pressuring politicians through activism as individuals or members of interest groups. However, majority rule is problematic according to Arrow's Impossibility Theorem and may not reflect preferences accurately. - Special interest and public interest groups influence outcomes through organizing, lobbying, and applying pressure. - Politicians in the legislature and executive branch make laws, policies, and administrative decisions, while the judicial system also plays a role. Bureaucratic agencies also influence outcomes.

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    11 views3 pages

    07 CH 6.pdfnotes

    Uploaded by

    Yoon Ho Kim
    Collective decisions are made through several actors and processes: - Citizen voters make decisions through majority rule voting and by pressuring politicians through activism as individuals or members of interest groups. However, majority rule is problematic according to Arrow's Impossibility Theorem and may not reflect preferences accurately. - Special interest and public interest groups influence outcomes through organizing, lobbying, and applying pressure. - Politicians in the legislature and executive branch make laws, policies, and administrative decisions, while the judicial system also plays a role. Bureaucratic agencies also influence outcomes.

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    of 3

    HOW ARE COLLECTIVE DECISIONS MADE?

    ECON 454
    LECTURE 6 PUBLIC CHOICE
    Charles R. Hulten 2011 1

    CITIZEN VOTERS MAJORITY RULE SPECIAL & PUBLIC INTEREST GROUPS ACTIVISM AGENDA SETTING MEDIA/POLICY GROUPS INFLUENCE CHOICES POLITICIANS LEGISLATURE: LAWS, OVERSIGHT (FUNDING) EXECUTIVE BRANCH: POLICIES, ADMINISTER PROG JUDICIAL SYSTEM BUREAUCRACY
    Charles R. Hulten 2011 2

    CITIZEN/VOTER
    AS INDIVIDUAL
    INDIVIDUAL PREFERENCES INFORMATION VOTING/PRESSURE OF OPINION SOCIAL WELFARE FUNCTION

    THEORETICAL PROBLEMS WITH MAJORITY RULE


    ARROW-IMPOSSIBILITY THEOREM NON-TRANSITIVITY AND CYCLING TYRANNY OF THE MEDIAN VOTER NO MECHANISM TO REGISTER INTENSITY OF PREFERENCE OTHER THAN APATHY OR ACTIVISM
    Charles R. Hulten 2011 4

    AS MEMBER OF SPECIAL INTEREST


    ORGANIZING LOBBYING/PRESSURE AFFECT POLITICAL OUTCOME
    Charles R. Hulten 2011 3

    EACH INDIVIDUAL HAS TRANSITIVE CHOICES? IS GROUP CHOICE ALSO TRANSITIVE? YES: B > C > A

    GROUP CHOICE NO LONGER TRANSITIVE IF FRANCIS REVERSES SECOND AND THIRD CHOICES: B > C, C > A, A > B

    Choice First Second Third

    Attila A B C

    Francis C B A

    Slack B C A

    Choice First Second Third

    Attila A B C

    Francis C A B

    Slack B C A

    Charles R. Hulten 2011

    Charles R. Hulten 2011

    COMPARE:
    YES: Choice First Second Third Attila A B C Francis C B A Slack B C A

    MEDIAN VOTER
    VOTERS ARE SPLIT ON PROPOSITION A, WHICH INVOLVES MORE SPENDING BUT HIGHER TAXES 10 PEOPLE WANT TO SPEND $1,000

    NO: Choice First Second Third Attila A B C Francis C A B Slack B C A

    1 PERSON WANTS TO SPEND $500 10 PEOPLE WANT TO SPEND $0


    7 Charles R. Hulten 2011 8

    Charles R. Hulten 2011

    AH, BUT WHATS THE STRATEGY NOW?


    VOTERS ARE STILL SPLIT ON PROP A, BUT
    6 PEOPLE STRONGLY WANT TO SPEND $1,000 4 PEOPLE LESS STRONG FOR $1,000, $750 OK 1 PERSON WANTS TO SPEND $500 4 PEOPLE LESS STRONG FOR $0, $250 OK 6 PEOPLE STRONGLY WANT TO SPEND $0
    Charles R. Hulten 2011 9

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