Risk aversion, overconfidence and private information as determinants of majority thresholds
Attanasi, G., Corazzini, L., Georgantzis, N. and Passarelli, F. (2014) Risk aversion, overconfidence and private information as determinants of majority thresholds. Pacific Economic Review, 19 (3). pp. 355-386. ISSN 1361-374X
To link to this item DOI: 10.1111/1468-0106.12070
We present and experimentally test a theoretical model of majority threshold determination as a function of voters’ risk preferences. The experimental results confirm the theoretical prediction of a positive correlation between the voter's risk aversion and the corresponding preferred majority threshold. Furthermore, the experimental results show that a voter's preferred majority threshold negatively relates to the voter's confidence about how others will vote. Moreover, in a treatment in which individuals receive a private signal about others’ voting behaviour, the confidence-related motivation of behaviour loses ground to the signal's strength.