Social Choice Theory

By Amartya Sen. Self-Organising Multi-Agent Systems, 2021

380 citations recorded by the source corpus.

Social choice theory extends information economics to the context of group or societal decision-making. The underlying assumption is that we do not know the preferences of individuals, but we want to use them to make decisions. The overarching question is whether it is possible to design decision-making rules or systems that will both encourage individuals to reveal their preferences and then use that information to make a reasonable decision. The general approach to the problem is …rst to study decision rules in the case of complete information about preferences and to identify a set of rules that satis…es particular desirable properties. Then, we turn back to the question of incentives for individuals to reveal information about their preferences to determine when it is a Nash equilibrium to reveal information honestly in voting (as an example of a rule for how societies make decisions in practice). An important observation is that the incentives to reveal information are bound up completely with how that information will be used in the societal decision. In general, a societal decision rule that has good properties for the case of complete information will also provide incentives for individuals to reveal their preferences honestly in voting. However, a societal decision rule that does not have good properties for the case of complete information about individual preferences, will provide incentives for people to conceal their preferences, i.e. by voting "dishonestly". Thus it makes sense to start with the decision rule and work backwards to incentives. There is another underlying assumption, which is that the attributes of available alternatives are known to everyone. It is not possible, for example, that one person is an expert whose opinion is more informed than everyone else's. The only uncertainty is how individuals value the alternatives. Throughout this discussion, we will (mostly) sidestep the question of strength of preferences. We 175

Subfields: General Decision Sciences

View Paper: https://www.semanticscholar.org/paper/ce11759cc4047695a847c7def648e5ad9ef0dbf7

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