Majority rule or dictatorship? The role of collective-choice rules in resolving social dilemmas with endogenous institutions

Research output: Working paperDiscussion paperOther research output

58 Downloads (Pure)

Abstract

Collective-choice rules aggregate individual choices into a group choice.
This study addresses the role of collective-choice rules in a social dilemma situation
in which group members can repeatedly choose a combination of institutions
to achieve self-governance. Specifically, we investigate three collectivechoice
rules: majority voting, dictatorship and rotating dictatorship. We identify
a direct and an indirect channel through which collective-choice rules may
affect groups’ behavior and performance in the game. Our main findings are:
(1) In terms of the direct effects, there is no evidence of a “democracy premium"
(i.e., cooperation level is higher under the institutions chosen via a democratic
rule than when the same institutions are chosen via a non-democratic rule). (2)
In terms of the indirect effects, institutional choices produced by a fixed dictator
are more stable than produced by rotating dictators. (3) Overall, groups
with a fixed dictator earn the highest payoffs.
Original languageEnglish
Place of PublicationTilburg
PublisherCentER, Center for Economic Research
Number of pages49
Volume2019-011
Publication statusPublished - 29 Apr 2019

Publication series

NameCentER Discussion Paper
Volume2019-011

    Fingerprint

Keywords

  • collective decision-making
  • social dilemma
  • institutions
  • majority rule
  • dictatorship
  • cooperation

Cite this

Liu, M., & van der Heijden, E. (2019). Majority rule or dictatorship? The role of collective-choice rules in resolving social dilemmas with endogenous institutions. (CentER Discussion Paper; Vol. 2019-011). Tilburg: CentER, Center for Economic Research.