Aggregating Local Preferences to Guide Marginal Policy Adjustments
American Economic Review Papers and Proceedings, 103(3): 605-610
11 Pages Posted: 26 Jan 2013 Last revised: 22 Sep 2013
Date Written: January 25, 2013
We propose a social choice rule for aggregating preferences elicited from surveys into a marginal adjustment of policy from the status quo. The mechanism is: (i) symmetric in its treatment of survey respondents; (ii) ordinal, using only the orientation of respondents’ indifference surfaces; (iii) local, using only preferences in the neighborhood of current policy; and (iv) what we call “first-order strategy-proof,” making the gains from misreporting preferences second order. The mechanism could be applied to guide policy based on how policy affects responses to subjective well-being surveys.
Keywords: subjective well-being, happiness, life satisfaction, aggregation, policy
JEL Classification: D69, H0, I38
Suggested Citation: Suggested Citation