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Kenneth Arrow's book, *Social Choice and Individual Values*, published in 1951, is widely recognized for inaugurating the modern era of social choice theory.
Answer: True
Explanation: Kenneth Arrow's seminal 1951 publication, *Social Choice and Individual Values*, is widely credited with establishing the foundations of contemporary social choice theory.
Which publication is widely recognized for inaugurating the modern era of social choice theory?
Answer: Kenneth Arrow's book, *Social Choice and Individual Values*
Explanation: Kenneth Arrow's seminal 1951 publication, *Social Choice and Individual Values*, is widely credited with establishing the foundations of contemporary social choice theory.
What fundamental problem does Arrow's impossibility theorem address regarding social choice functions?
Answer: The impossibility of creating a social choice function satisfying fairness and rationality criteria with ordinal preferences without being dictatorial.
Explanation: Arrow's impossibility theorem elucidates the fundamental challenge of constructing a social choice function that simultaneously adheres to a set of desirable criteria—such as fairness, rationality, and non-dictatorship—when aggregating preferences solely on an ordinal basis. It proves that such a function can only exist if it is dictatorial, implying inherent limitations in achieving collective rationality without compromising these principles.
A Condorcet cycle violates the anonymity property of voting rules, meaning the identity of voters affects the outcome.
Answer: False
Explanation: A Condorcet cycle, characterized by cyclical majority preferences (A>B, B>C, C>A), violates the property of transitivity, not anonymity. Anonymity requires that the outcome is independent of the identities of the voters.
May's theorem demonstrates that simple majority rule is the only voting mechanism that is neutral, anonymous, and positively responsive when there are three or more outcomes.
Answer: False
Explanation: May's theorem applies specifically to binary choices (two outcomes) with ordinal preferences, identifying simple majority rule as unique under those conditions. The theorem does not extend to situations with three or more outcomes.
May's theorem states that simple majority voting is the unique voting rule that is neutral, anonymous, and positively responsive when there are only two candidates and preferences are expressed as cardinal utility.
Answer: False
Explanation: May's theorem applies when preferences are expressed as ordinal utility (rankings), not cardinal utility. It identifies simple majority voting as unique under these conditions for binary choices.
The condition stating that the social choice between two options should only depend on individual preferences between those two options is known as:
Answer: Independence of Irrelevant Alternatives (IIA)
Explanation: The 'independence of irrelevant alternatives' (IIA) is a condition stipulating that the collective choice between two options should be determined solely by individual preferences between those two options, irrespective of other available alternatives. Arrow's theorem demonstrates that social choice functions derived from ordinal preferences frequently violate IIA, thereby enabling phenomena such as 'spoiler effects'.
What property is violated when a Condorcet cycle occurs (e.g., A is preferred to B, B to C, and C to A)?
Answer: Transitivity
Explanation: A Condorcet cycle emerges when collective preferences exhibit cyclical majorities (e.g., A is preferred to B, B to C, and C to A). This pattern directly contravenes the property of transitivity, a fundamental requirement for consistent preferences, which mandates that if A is preferred to B and B to C, then A must be preferred to C.
May's theorem shows that for two outcomes and ordinal preferences, which voting mechanism is unique in being neutral, anonymous, and positively responsive?
Answer: Simple majority rule
Explanation: May's theorem establishes that for binary choices (two outcomes) with ordinal preferences, simple majority rule is uniquely characterized by neutrality, anonymity, and positive responsiveness.
The 'spoiler effect' in voting systems is a consequence of violating which condition?
Answer: Independence of Irrelevant Alternatives
Explanation: The 'spoiler effect,' wherein a candidate's presence alters the election outcome to the detriment of a more preferred candidate, arises from the violation of the Independence of Irrelevant Alternatives (IIA) condition, a key finding demonstrated in Arrow's theorem.
Gibbard's theorem proves that for any voting rule with three or more outcomes, it is impossible for voters to strategically misrepresent their preferences.
Answer: False
Explanation: Gibbard's theorem demonstrates that for any voting rule with three or more outcomes, it is *possible* for voters to strategically misrepresent their preferences to achieve a better outcome, meaning such rules are generally not strategyproof.
The Gibbard-Satterthwaite theorem implies that ranked-choice voting systems with three or more outcomes are inherently strategyproof.
Answer: False
Explanation: The Gibbard-Satterthwaite theorem implies that ranked-choice voting systems with three or more outcomes cannot be inherently strategyproof, meaning strategic manipulation of votes is often possible.
The revelation principle states that for any achievable social choice function, there exists a direct mechanism where truthful revelation is *not* a dominant strategy.
Answer: False
Explanation: The revelation principle states that for any achievable social choice function, there exists a direct mechanism where truthful revelation *is* a dominant strategy for all participants.
The Vickrey-Clarke-Groves (VCG) mechanism differs from standard voting by using monetary transfers to incentivize honest behavior and achieve Pareto efficiency.
Answer: True
Explanation: The Vickrey-Clarke-Groves (VCG) mechanism distinguishes itself from conventional voting systems by its capacity to achieve Pareto efficiency and incentivize truthful reporting of preferences through the strategic use of monetary transfers among participants.
The dictatorship mechanism is a social choice function where the preferences of a single designated voter determine the outcome, regardless of the preferences of all other voters.
Answer: True
Explanation: The dictatorship mechanism represents a social choice function where the outcome is solely determined by the preferences of one designated voter, irrespective of all other participants' preferences.
'Strategyproofness' refers to a property of a voting rule where voters have no incentive to misrepresent their true preferences.
Answer: True
Explanation: A voting system is strategyproof if no voter can achieve a better outcome for themselves by casting a vote that misrepresents their true preferences. In such a system, sincere voting is always the best strategy.
The Gibbard-Satterthwaite theorem proves that for any voting rule with three or more outcomes, it cannot be both strategyproof and non-dictatorial.
Answer: True
Explanation: The Gibbard-Satterthwaite theorem establishes that for any voting rule encompassing three or more alternatives, it is impossible to simultaneously satisfy the properties of strategyproofness and non-dictatorship, thereby confirming the inherent possibility of strategic manipulation.
The 'revelation principle' states that for any social choice function achievable by any mechanism, there exists a direct mechanism where truthful revelation is a dominant strategy.
Answer: True
Explanation: The revelation principle is a cornerstone of mechanism design, asserting that for any social choice function implementable through any mechanism, there exists a direct mechanism where truthful preference revelation is a dominant strategy for all participants.
What does Gibbard's theorem prove about voting rules with three or more outcomes?
Answer: They inevitably allow for strategic misrepresentation of preferences.
Explanation: Gibbard's theorem demonstrates that for any voting rule with three or more outcomes, it is possible for voters to strategically misrepresent their preferences to achieve a better outcome, meaning such rules are generally not strategyproof.
The Gibbard-Satterthwaite theorem implies that ranked-choice voting systems with three or more outcomes cannot be:
Answer: Strategyproof
Explanation: The Gibbard-Satterthwaite theorem implies that ranked-choice voting systems with three or more outcomes cannot be inherently strategyproof, meaning strategic manipulation of votes is often possible.
What does the revelation principle state regarding social choice functions?
Answer: For any achievable social choice function, there exists a direct mechanism where truthful revelation is a dominant strategy.
Explanation: The revelation principle is a cornerstone of mechanism design, asserting that for any social choice function implementable through any mechanism, there exists a direct mechanism where truthful preference revelation is a dominant strategy for all participants.
How does the Vickrey-Clarke-Groves (VCG) mechanism differ from standard voting?
Answer: VCG uses monetary transfers to incentivize honest behavior and achieve efficiency.
Explanation: The Vickrey-Clarke-Groves (VCG) mechanism distinguishes itself from conventional voting systems by its capacity to achieve Pareto efficiency and incentivize truthful reporting of preferences through the strategic use of monetary transfers among participants.
What does it mean for a voting system to be 'strategyproof'?
Answer: Voters have no incentive to misrepresent their true preferences.
Explanation: A voting system is strategyproof if no voter can achieve a better outcome for themselves by casting a vote that misrepresents their true preferences. In such a system, sincere voting is always the best strategy.
What is the main implication of the Gibbard-Satterthwaite theorem?
Answer: It is impossible for a voting rule with 3+ outcomes to be both strategyproof and non-dictatorial.
Explanation: The Gibbard-Satterthwaite theorem establishes that for any voting rule encompassing three or more alternatives, it is impossible to simultaneously satisfy the properties of strategyproofness (i.e., no incentive for voters to misrepresent their preferences) and non-dictatorship, thus confirming the inherent possibility of strategic manipulation.
A central debate in social choice theory concerns whether individual preferences can be compared across different people (interpersonal utility comparison).
Answer: True
Explanation: A fundamental ongoing debate within social choice theory centers on the feasibility and validity of interpersonal utility comparisons—that is, whether the subjective utility or well-being experienced by individuals can be meaningfully measured and compared across different persons. This issue profoundly influences the design and applicability of various social welfare functions.
Lionel Robbins argued that concepts of utility were easily quantifiable and scientifically verifiable, supporting interpersonal comparisons.
Answer: False
Explanation: Lionel Robbins contended that utility concepts lacked scientific rigor and were unfalsifiable, specifically questioning the possibility of measuring or meaningfully comparing utility across individuals. He posited that such comparisons fell outside the purview of empirical science.
Amartya Sen and John Harsanyi argued that while perfect comparisons of mental states might be impossible, people can still make partial comparisons of utility.
Answer: True
Explanation: Amartya Sen and John Harsanyi countered Robbins' critique by arguing that while perfect comparisons of subjective mental states may be unattainable, partial comparisons of utility are indeed feasible and valuable, owing to shared human experiences and psychologies. They advocated for the continued use of social choice theory under the assumption of at least partial comparability.
Public choice theory is primarily normative, focusing on how societies *should* make decisions, while social choice theory is descriptive.
Answer: False
Explanation: Public choice theory is primarily normative, focusing on how societies *should* make decisions, while social choice theory is descriptive.
The Journal of Economic Literature (JEL) classifies Public Choice theory under JEL D71 (Clubs, committees, associations).
Answer: False
Explanation: The Journal of Economic Literature (JEL) classifies Social Choice theory under JEL D71, while Public Choice theory is classified under JEL D72 (Economic models of political processes).
Since Arrow's foundational work, social choice theory research has been predominantly empirical, focusing on observational data.
Answer: False
Explanation: Since the seminal contributions of Kenneth Arrow, the dominant characteristic of social choice theory research has been its emphasis on mathematical and theoretical modeling, prioritizing abstract frameworks and formal proofs over empirical data analysis.
Some research has aimed to empirically estimate the frequency of various voting paradoxes, such as the Condorcet paradox, in real-world elections.
Answer: True
Explanation: Empirical research within social choice theory has largely focused on quantifying the incidence of theoretical phenomena, such as voting paradoxes like the Condorcet paradox, through the analysis of real-world electoral data.
Based on a summary of 37 studies, the Condorcet paradox occurred in approximately 9.4% of analyzed elections.
Answer: True
Explanation: Synthesized findings from 37 studies encompassing 265 elections indicate that the Condorcet paradox manifests in approximately 9.4% of observed cases, with 25 specific instances documented.
Condorcet paradoxes are more frequently observed in larger settings, such as national electorates, compared to smaller committees.
Answer: False
Explanation: Empirical observations suggest that Condorcet paradoxes are more prevalent in smaller deliberative bodies, such as committees and parliamentary settings, compared to larger electorates.
What is a central debate in social choice theory regarding individual preferences?
Answer: Whether individual preferences can be compared across different people.
Explanation: A fundamental ongoing debate within social choice theory centers on the feasibility and validity of interpersonal utility comparisons—that is, whether the subjective utility or well-being experienced by individuals can be meaningfully measured and compared across different persons. This issue profoundly influences the design and applicability of various social welfare functions.
Lionel Robbins' critique of interpersonal utility comparisons argued they were:
Answer: Unscientific and unfalsifiable.
Explanation: Lionel Robbins contended that utility concepts lacked scientific rigor and were unfalsifiable, specifically questioning the possibility of measuring or meaningfully comparing utility across individuals. He posited that such comparisons fell outside the purview of empirical science.
How did Sen and Harsanyi respond to Robbins' critique of interpersonal utility comparisons?
Answer: They argued that while perfect comparisons are impossible, partial comparisons are feasible and useful.
Explanation: Amartya Sen and John Harsanyi countered Robbins' critique by arguing that while perfect comparisons of subjective mental states may be unattainable, partial comparisons of utility are indeed feasible and valuable, owing to shared human experiences and psychologies. They advocated for the continued use of social choice theory under the assumption of at least partial comparability.
What is the primary distinction between public choice and social choice theory?
Answer: Public choice models political actors' behavior (positive), social choice focuses on ideal decision procedures (normative).
Explanation: The fundamental distinction lies in their methodological approaches: public choice theory predominantly employs positive economics to model the behavior of political actors, whereas social choice theory is primarily normative, investigating the theoretical properties of ideal decision-making procedures.
According to the Journal of Economic Literature (JEL), where is Social Choice theory classified?
Answer: JEL D71 (Clubs, committees, associations)
Explanation: The Journal of Economic Literature (JEL) categorizes Social Choice theory within Microeconomics under the classification JEL D71, which pertains to clubs, committees, and associations. This contrasts with Public Choice theory, classified under JEL D72, focusing on economic models of political processes.
What has been the dominant characteristic of social choice theory research since Kenneth Arrow's foundational work?
Answer: Mathematical and theoretical modeling.
Explanation: Since the seminal contributions of Kenneth Arrow, the dominant characteristic of social choice theory research has been its emphasis on mathematical and theoretical modeling, prioritizing abstract frameworks and formal proofs over empirical data analysis.
What kind of empirical research has been conducted in social choice theory?
Answer: Estimating the frequency of voting paradoxes in real elections.
Explanation: Empirical research within social choice theory has largely focused on quantifying the incidence of theoretical phenomena, such as voting paradoxes like the Condorcet paradox, through the analysis of real-world electoral data.
Based on summarized studies, what is the approximate likelihood of a Condorcet paradox occurring in elections?
Answer: Approximately 9.4%
Explanation: Synthesized findings from 37 studies encompassing 265 elections indicate that the Condorcet paradox manifests in approximately 9.4% of observed cases, with 25 specific instances documented.
Where are Condorcet paradoxes more frequently observed?
Answer: Small committees and parliaments
Explanation: Empirical observations suggest that Condorcet paradoxes are more prevalent in smaller deliberative bodies, such as committees and parliamentary settings, compared to larger electorates.