On the Justice of Decision Rules
20 Pages Posted: 30 Jul 2007 Last revised: 10 Jan 2010
Date Written: September 1, 2009
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: Suggested Citation