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Social choice theory Wiki2Web Clarity Challenge

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Study Guide: Foundations of Social Choice Theory: Key Concepts, Theorems, and Debates

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Foundations of Social Choice Theory: Key Concepts, Theorems, and Debates Study Guide

Core Concepts and Foundations of Social Choice Theory

Social choice theory primarily focuses on how individuals make rational choices to maximize their utility.

Answer: False

Explanation: Social choice theory extends the principles of rational individual choice to collective decision-making, focusing on how societies aggregate preferences, rather than solely on individual utility maximization.

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Social choice theory is a descriptive field that analyzes how societies actually make decisions, contrasting with political science.

Answer: False

Explanation: Social choice theory is primarily a normative field, concerned with how societies *ought* to make decisions, whereas political science is largely descriptive, analyzing how decisions are *actually* made.

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A social choice function, often referred to as a voting system in politics, is a rule that takes individual preferences over a set of outcomes and selects a single outcome.

Answer: True

Explanation: A social choice function, frequently termed a voting system in political science, is formally defined as a rule that aggregates individual preferences over a set of alternatives to determine a single collective outcome. The evaluation of these functions often relies on the mathematical properties or axioms they satisfy.

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What is the primary focus of social choice theory?

Answer: Studying mathematical procedures to combine individual preferences into a collective decision.

Explanation: Social choice theory is a field within welfare economics that extends the principles of rational individual choice to the domain of collective decision-making. It critically examines the mathematical procedures, termed social welfare functions, employed to aggregate diverse individual preferences into a unified societal choice.

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How does social choice theory primarily differ from political science?

Answer: Social choice theory is normative (how societies *can* make decisions), while political science is descriptive (how they *actually* do).

Explanation: Social choice theory primarily distinguishes itself from political science by its normative orientation, focusing on the theoretical frameworks for how societies *ought* to make decisions. Political science, conversely, adopts a descriptive approach, analyzing the empirical realities of how decisions are *actually* made within political systems.

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Which early manuscript is considered a precursor to modern social choice theory?

Answer: Ramon Llull's *Ars Electionis*

Explanation: Ramon Llull's 1299 treatise, *Ars Electionis* (The Art of Elections), is recognized as an early precursor to modern social choice theory, having explored concepts that would later become central to the discipline.

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What defines a 'social choice function' in the context of voting systems?

Answer: A rule that takes individual preferences and selects a single outcome.

Explanation: A social choice function, frequently termed a voting system in political science, is formally defined as a rule that aggregates individual preferences over a set of alternatives to determine a single collective outcome. The evaluation of these functions often relies on the mathematical properties or axioms they satisfy.

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Arrow's Impossibility Theorem and its Axioms

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.

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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.

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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.

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Voting Properties, Paradoxes, and May's Theorem

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.

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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.

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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.

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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'.

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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.

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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.

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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.

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Key Social Welfare Rules and Harsanyi's Theorem

Harsanyi's utilitarian theorem suggests that the utilitarian rule is the only coherent and Pareto efficient social choice function under certain preference conditions.

Answer: True

Explanation: Harsanyi's utilitarian theorem posits that under specific conditions of preference coherence and behavior under uncertainty, the utilitarian rule—which seeks to maximize the sum of individual utilities—is the sole social choice function that is both logically consistent and Pareto efficient.

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Selecting a Condorcet winner is significant because it is the unique voting rule that is resolvable, neutral, anonymous, and non-manipulable when such a winner exists.

Answer: True

Explanation: The significance of selecting a Condorcet winner lies in its unique property: when such a winner exists within a given set of preferences, the voting rule that selects it is simultaneously resolvable, neutral, anonymous, and non-manipulable.

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The utilitarian perspective holds that individual preferences are interpersonally incomparable and should be maximized individually.

Answer: False

Explanation: The utilitarian perspective posits that individual preferences and utilities are interpersonally comparable and should be summed to maximize aggregate societal well-being.

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The Utilitarian rule and the Egalitarian rule are two common types of social choice rules discussed.

Answer: True

Explanation: The two most frequently discussed types of social choice rules are the Utilitarian rule, which aims to maximize the aggregate sum of individual utilities, and the Egalitarian rule, which seeks to maximize the minimum utility level attained by any individual within the society.

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The Utilitarian rule is also known as the max-min rule or Rawlsian welfare.

Answer: False

Explanation: The Utilitarian rule is also known as the max-sum rule or Benthamite welfare, reflecting its goal of maximizing the total utility across all individuals. The max-min rule is synonymous with the Egalitarian rule.

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The Egalitarian rule is also referred to as the max-min rule or Rawlsian welfare.

Answer: True

Explanation: The Egalitarian rule is also commonly referred to as the 'max-min rule' or 'Rawlsian welfare,' signifying its focus on enhancing the welfare of the least advantaged members of society by maximizing their minimum utility level.

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Harsanyi's theorem suggests that under certain conditions ('well-behaved under uncertainty'), the only coherent and Pareto efficient social choice function is:

Answer: The Utilitarian rule

Explanation: Harsanyi's utilitarian theorem posits that under specific conditions of preference coherence and behavior under uncertainty, the utilitarian rule—which seeks to maximize the sum of individual utilities—is the sole social choice function that is both logically consistent and Pareto efficient.

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What is the significance of selecting a Condorcet winner in social choice theory?

Answer: It represents a unique voting rule that is resolvable, neutral, anonymous, and non-manipulable when such a winner exists.

Explanation: The significance of selecting a Condorcet winner lies in its unique property: when such a winner exists within a given set of preferences, the voting rule that selects it is simultaneously resolvable, neutral, anonymous, and non-manipulable.

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From a utilitarian perspective, what is the basis for social welfare?

Answer: Summing and maximizing interpersonally comparable utilities.

Explanation: The utilitarian perspective posits that individual preferences and utilities are inherently interpersonally comparable, allowing for the summation of individual utilities to gauge aggregate societal well-being, which is then optimized for the collective good.

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What is another name for the Utilitarian rule in social choice theory?

Answer: Benthamite welfare

Explanation: The Utilitarian rule is also known as the max-sum rule or Benthamite welfare, reflecting its goal of maximizing the total utility across all individuals.

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What is another name for the Egalitarian rule in social choice theory?

Answer: Rawlsian welfare

Explanation: The Egalitarian rule is also commonly referred to as the 'max-min rule' or 'Rawlsian welfare,' signifying its focus on enhancing the welfare of the least advantaged members of society by maximizing their minimum utility level.

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Strategyproofness, Mechanism Design, and Gibbard-Satterthwaite

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.

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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.

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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.

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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.

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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.

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'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.

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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.

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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.

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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.

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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.

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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.

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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.

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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.

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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.

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Contemporary Debates and Empirical Applications

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.

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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.

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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.

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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.

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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).

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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.

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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.

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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.

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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.

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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.

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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.

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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.

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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.

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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.

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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.

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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.

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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.

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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.

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