On the Justice of Decision Rules

20 Pages Posted: 30 Jul 2007 Last revised: 10 Jan 2010

See all articles by Jose Apesteguia

Jose Apesteguia

Universitat Pompeu Fabra - Department of Economics and Business (DEB)

Miguel A. Ballester

University of Navarra - School of Economics

Rosa Ferrer

Universitat Pompeu Fabra - Faculty of Economic and Business Sciences; Barcelona Graduate School of Economics (Barcelona GSE)

Date Written: September 1, 2009

Abstract

Which decision rules are the most efficient? Which are the best in terms of maximin, or maximax? We study these questions for the case of a group of individuals faced with a collective choice from a set of alternatives. A key message from our results is that the set of optimal decision rules is well-defined, particularly simple, and well-known: the class of scoring rules. We provide the optimal scoring rules for the three different ideals of justice under consideration: utilitarianism (efficiency), maximin, and maximax. The optimal utilitarian scoring rule depends crucially on the probability distribution of the utilities. The optimal maximin (resp. maximax) scoring rule takes the optimal utilitarian scoring rule and applies a factor that shifts it towards negative voting (resp. plurality voting).

Keywords: Decision Rules, Scoring Rules, Utilitarianism, Maximin, Maximax

JEL Classification: D00, D63, D71, D72

Suggested Citation

Apesteguia, Jose and Ballester, Miguel A. and Ferrer, Rosa, On the Justice of Decision Rules (September 1, 2009). Available at SSRN: https://ssrn.com/abstract=1002562 or http://dx.doi.org/10.2139/ssrn.1002562

Jose Apesteguia (Contact Author)

Universitat Pompeu Fabra - Department of Economics and Business (DEB) ( email )

Barcelona, 08005
Spain

HOME PAGE: http://www.econ.upf.es/~apesteguia/

Miguel A. Ballester

University of Navarra - School of Economics ( email )

Universidad de Navarra
Campus Universitario
Pamplona, 31009
Spain

Rosa Ferrer

Universitat Pompeu Fabra - Faculty of Economic and Business Sciences ( email )

Ramon Trias Fargas 25-27
Barcelona, 08005
Spain

Barcelona Graduate School of Economics (Barcelona GSE) ( email )

Ramon Trias Fargas, 25-27
Barcelona, Barcelona 08005
Spain

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