Menu Dependence and Group Decision Making

This paper is concerned with the problem of group decision making. We introduce the notion of a collective system rule. A collective system rule maps each preference profile to a group-preference system, which is a collection of social preferences on the subsets of the alternatives. By formulating the Arrovian conditions, we show the Arrow-type impossibility theorems. We also discuss how our approach is related to the standard group decision-making process.     

Decisive coalitions and positive responsiveness

This paper addresses the Arrovian social choice problem. Our focus is the role of positive responsiveness, which requires social judgments to be strongly monotonic with respect to individual judgments. We clarify the structure of decisive coalitions associated with collective choice rules that satisfy positive responsiveness and Arrow's axioms. Transitivity of social preferences is relaxed to quasi‐transitivity or acyclicity.     

A linguistic decision process in group decision making

Assuming a set of linguistic preferences representing the preferences of the individuals, a linguistic choice process is presented. This is developed using the concept of fuzzy majority for deriving a collective linguistic preference, and the concept of nondominated alternatives for deriving the selected alternatives in the linguistic choice process. The fuzzy majorities are equated with fuzzy linguistic quantifiers. The collective linguistic preference is derived by means of a linguistic ordered weighted averaging operator whose weights are defined using a fuzzy linguistic quantifier. In order to obtain the nondominated alternatives, we present a novel reformulation of Orlovski's nondominance degree under linguistic information.     

Rule-Inequality-Aversion Preference and Conditional Cooperation in Public Goods Experiments: Economic Experiment Evidence from China

We provide an experimental investigation of the fair rule preference and its effect on anonymous cooperation, intending to test the hypothesis that people who exhibit high degrees of rule inequality aversion—consider “equality and mutual obligation under the social contract” as justified, are disgusted with free-rider behavior in the public goods game and are more likely to be conditional cooperators and make conditional contributions. Based on experimental work related to rule-preferences Chlaß and Moffatt (Giving in dictator games: experimenter demand effect or preference over the rules of the game? (No. 2012, 044). Jena Economic Research Papers, 2012) and the public goods game Fischbacher et al. (Am Econ Rev 100(1):541–556, 2010), we designed a dictator game with the option of buying a veto (when the veto was purchased, the level of rule inequality decreased, making it an ultimatum game) to measure rule preference, i.e., rule inequality aversion, and conducted a two-stage public goods experiment to identify the cooperation preferences and repeated cooperation levels of participants. We investigated the relationship between rule preferences and cooperative preferences (conditional reciprocal preference) and tried to explain the adjustments people made when making repeated contributions of public goods (conditional cooperation behavior) from a rule preference perspective. The results show that: (1) Heterogeneous rule-inequality-aversion preferences are found in lab; (2) The stronger the rule-inequality-aversion preference is, the higher the probability is for the individual to become a conditional cooperator in public goods experiment; (3) Individuals who have stronger rule-inequality-aversion are more sensitive to the contributions that are deviated from the norm. Compared to the theory of conditional cooperation types, rule-inequality-aversion preference has a better explanation power when it comes to the behavior adjustment in repeated public goods contribution.     

Time orientation and construal level: effects on eating and exercising behaviour and preferences

Eating and exercising behaviour are both characterized by immediate and future consequences. Consequently, consideration of these consequences (i.e. time orientation) predicts eating and exercising behaviour. We investigate whether construal level acts as an underlying mechanism of these relations. Students (N = 101) completed measures of consideration of immediate and future consequences (i.e. CFC‐food and CFC‐exercise), construal level, eating and exercising behaviour and preferences. For self‐reported eating and exercising behaviour, only direct effects of consideration of immediate and future consequences were found. For eating preferences, however, there was evidence of an indirect effect through construal level. A stronger tendency to consider future consequences led to a stronger preference for utilitarian (as compared with hedonic) food products through a more abstract construal level. All in all, construal level partially explains the differential relations between consideration of immediate and future consequences and eating and exercising behaviour and preferences.     

Shopping Style Segmentation of Consumers

The World Wide Web has rapidly become an alternative means to reach customers and has attracted the attention of many businesses. Unfortunately, however, despite its growth, there is little knowledge of which consumers would be willing to switch to the new format and to what extent. Our paper is aimed at providing some insights into these questions. Specifically, we propose a model to identify segments that differ in their shopping style, i.e., in their preference for which format, or bundle of formats, they like to shop in.Our research question, and model, is similar in spirit to prior research in marketing on how consumers choose assortments. Despite this similarity, our research makes some substantive and methodological contributions to the literature. Substantively, we examine the issue of the choice of channel assortments by consumers across a variety of product categories. We believe this is an important question and one that has not been examined earlier. From a methodological point of view, our model adds to earlier work by specifying the utility of an assortment as a sum of the deterministic and stochastic components of the utilities of its members. This contrasts with previous research where only the deterministic components of the utilities of the component brands of an assortment are added and the relationships between their random components are not accounted for.We calibrate the model on data regarding the format choices of households. In order to control for potentially similar format preferences across purchases of different categories we specify the model to allow for correlation between format preferences over the choice history of each household. Our results suggest that there are four segments of consumers that differ in their preference for different types of formats.     

Resolving Group Choice Paradoxes Using Probabilistic and Fuzzy Concepts

The standard assumption of modern social choice theory is that the individuals are endowed with complete and transitive preference relations over the decision alternatives. A large number of incompatibility results has been achieved regarding aggregation of these kinds of preferences. Yet, most voting procedures make no use of this information. Instead they essentially cut down the information provided by the voters. In this paper we deal with some alternatives to the complete and transitive voter preference assumption. Particular attention is paid to imprecise notions: probabilistic and fuzzy preference relations. Rather than establishing new impossibility results, our focus is in resolving various voting paradoxes using imprecise preference concepts.     

Probabilities of Consistent Election Outcomes with Majorities Based on Difference in Support

Computer simulations are used to evaluate the likelihood of consistent outcomes under the class of majorities based on difference in support. These majorities require certain consensus in collective preferences to declare an alternative as the winner. More precisely, individuals show preference intensities in the unit interval among each pair of alternatives and it is required that the winner alternative obtains a difference in the sum of the intensities with respect to the loser alternative. This difference is a real number located between 0 and the total number of voters. We introduce the values of the required threshold for which majorities based on difference in support lead to transitive and triple-acyclic collective decisions with a probability of 1. Our results improve the previous theoretical ones since they require softer thresholds to reach consistent collective decisions.     

Selection of a Representative Value Function for Robust Ordinal Regression in Group Decision Making

In this paper, we introduce the concept of a representative value function in a group decision context. We extend recently proposed methods UTA^GMS-GROUP and UTADIS^GMS-GROUP with selection of a compromise and collective preference model which aggregates preferences of several decision makers (DMs) and represents all instances of preference models compatible with preference information elicited from DMs. The representative value function is built on results of robust ordinal regression, so its representativeness can be interpreted in terms of robustness concern. We propose a few procedures designed for multiple criteria ranking, choice, and sorting problems. The use of these procedures is conditioned by both satisfying different degrees of consistency of the preference information provided by all DMs, as well as by some properties of particular decision making situations. The representative value function is intended to help the DMs to understand the robust results, and to provide them with a compromise result in case of conflict between the DMs.     

Integrating Time-Preferences into E-Negotiation Systems: A Model,Elicitation Approach and Experimental Implications

Researchers have advocated that the acquisition of user preferences is important to the successful adoption of electronic negotiation systems. In this paper, we focus on one such preference, namely time preference, wherein the price of a good/service varies according to the delivery/consumption time. Time preference is a behavioral aspect that varies across buyers. We discuss how different types of preferences can be elicited, represented and integrated with electronic negotiations. We discuss three experiments to study the effect of time preferences on negotiation. The first is a preference elicitation experiment involving 36 subjects. The next two are agent-to-agent negotiation experiments, one based on the individual preferences obtained earlier and the other based on an expanded dataset on both individual preferences as well as negotiation parameters. The agent-based experiment compares outcomes and efficiencies between the standard exponential discounting model and two behavioral models of time preference. Our results bring out the preferences of subjects, as well as the extent to which negotiation is affected and enhanced by the incorporation of time-preferences.     

A Distance-Based Consensus Model with Flexible Choice of Rank-Position Weights

In this paper we propose a preference aggregation procedure for those cases in which the decision-makers express their preferences by means of a ranking of alternatives. Among the most applied methods for this purpose are those inspired by the Borda–Kendall rule, which attach to each alternative an aggregated value of the votes received in the different rank positions, and those based on distance measures between individual and collective preferences, which look for the solution that maximizes the consensus. The main idea here is to integrate these two approaches. Taking into account that the information about the values of weights or utilities assigned to each rank position is imprecise, we propose an evaluation of the alternatives using that vector of weights that minimizes the disagreement between DMs. In order to solve the problem, mixed-integer linear programming models are constructed. Two numerical examples are examined to illustrate the applicability of the proposed procedure.     

Investigating brand preferences across social groups and consumption contexts

Using a unique dataset on U.S. beer consumption, we investigate brand preferences of consumers across various social group and context related consumption scenarios (??scenarios??). As sufficient data are not available for each scenario, understanding these preferences requires us to share information across scenarios. Our proposed modeling framework has two main building blocks. The first is a standard continuous random coefficients logit model that the framework reduces to in the absence of information on social groups and consumption contexts. The second component captures variations in mean preferences across scenarios in a parsimonious fashion by decomposing the deviations in preferences from a base scenario into a low dimensional brand map in which the brand locations are fixed across scenarios but the importance weights vary by scenario. In addition to heterogeneity in brand preferences that is reflected in the random coefficients, heterogeneity in preferences across scenarios is accounted for by allowing the brand map itself to have a discrete heterogeneity distribution across consumers. Finally, heterogeneity in preferences within a scenario is accounted for by allowing the importance weights to vary across consumers. Together, these factors allow us to parsimoniously account for preference heterogeneity across brands, consumers and scenarios. We conduct a simulation study to reassure ourselves that using the kind of data that is available to us, our proposed estimator can recover the true model parameters from those data. We find that brand preferences vary considerably across the different social groups and consumption contexts as well as across different consumer segments. Despite the sparse data on specific brand-scenario combinations, our approach facilitates such an analysis and assessment of the relative strengths of brands in each of these scenarios. This could provide useful guidance to the brand managers of the smaller brands whose overall preference level might be low but which enjoy a customer franchise in a particular segment or in a particular context or a social group setting.     

Information Asymmetry in Consumer Perceptions of Quality‐Differentiated Food Products

Increasing consumer demand for quality‐differentiated food products has given rise to a large quantity of food product classifications related to production practices and locations. Some food product claims such as native have no clear definitions and may have ambiguous connotations for different consumers. We analyze whether asymmetry in information affects consumer preferences and willingness to pay for ambiguous claims using the native attribute. An empirical application of pecans is used in the analysis to compare native and improved pecan varieties. With no evidence in the literature of additional benefits of native varieties, the results showed that consumers preferred native varieties. Furthermore tastes and preferences for all product attributes were heterogeneous; heterogeneity in preference for the native attribute was only significant at the 10% level.     

What makes you click?—Mate preferences in online dating

We estimate mate preferences using a novel data set from an online dating service. The data set contains detailed information on user attributes and the decision to contact a potential mate after viewing his or her profile. This decision provides the basis for our preference estimation approach. A potential problem arises if the site users strategically shade their true preferences. We provide a simple test and a bias correction method for strategic behavior. The main findings are (i) There is no evidence for strategic behavior. (ii) Men and women have a strong preference for similarity along many (but not all) attributes. (iii) In particular, the site users display strong same-race preferences. Race preferences do not differ across users with different age, income, or education levels in the case of women, and differ only slightly in the case of men. For men, but not for women, the revealed same-race preferences correspond to the same-race preference stated in the users’ profile. (iv) There are gender differences in mate preferences; in particular, women have a stronger preference than men for income over physical attributes.     

Consumer preferences for environmental quality and other social goals

Environmental preferences and behaviour can shed some light on the more general problems of rationality. This article will explore the completeness and transitivity of preferences for environmental quality and other social goals. Reasons for possible inconsistencies will be discussed, and the consistency of preference rankings studied with the help of survey data and the Analytic Hierarchy Process method. The results show that it is difficult for respondents to give complete and transitive preference rankings when they compare abstract social goals. However, preferences are very consistent with respect to the most and the least preferred options. Different population subgroups seem to have rather similar preference orderings. This reflects the existence of largely shared values in the population studied. Environmental quality is generally perceived as one of the most important social goals, and the study shows a high demand for this collective good. However, free riding tendencies are present as soon as a social goal interferes with the respondents' own economic utility. Shifts between a collective welfare criterion and an individual utility criterion may be one of the reasons for the inconsistency of preference rankings of social goals.

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Konsumentenpräferenzen für die Qualität der Umwelt und andere soziale Ziele

Zusammenfassung Die Analyse von Umweltpräferenzen und Umweltverhalten kann etwas beitragen zu der Frage der Rationalität von Konsumenten. Der vorliegende Artikel erforscht die Vollständigkeit und Transitivität von Präferenzen für Umweltqualität und andere soziale Ziele. Er diskutiert Gründe für mögliche Inkonsistenzen und analysiert die tatsächliche Konsistenz von Präferenzrangordnungen mit Hilfe von Umfragedaten und der AHP-Methode (Analytic Hierarchy Process Method).Die Ergebnisse zeigen, daß es für Befragte schwierig ist, vollständige und transitive Präferenzrangfolgen zu bilden, wenn es um abstrakte soziale Ziele geht. Allerdings ist die Konsistenz jeweils sehr hoch bei den am meisten und den am wenigsten präferierten Optionen. Unterschiedliche Teilgruppen der Bevölkerung haben offenbar ganz ähnliche Präferenzrangfolgen. Das ist ein Indiz dafür, daß es weithin akzeptierte Wertvorstellungen in der Bevölkerung gibt.Umweltqualität wird allgemein als eines der wichtigsten sozialen Ziele angesehen, und die Studie zeigt einen hohen Bedarf nach diesem kollektiven Gut. Allerdings ist eine Tendenz zur Trittbrettfahrer-Mentalität vorhanden, wenn ein solches soziales Ziel in Konflikt gerät mit dem individuellen ökonomischen Nutzen des Befragten. Verschiebungen zwischen einem kollektiven Wohlfahrtskriterium und einem individuellen Nutzenkriterium sind vermutlich ein Grund für die Inkonsistenz von Präferenzrangfolgen sozialer Ziele.

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Liisa Uusitalo is an Associate Professor of Business Administration at the Helsinki School of Economics, Runeberginkatu 14-16, SF-00100 Helsinki, Finland.     

On Consensus of Group Decision Making with Interval Utility Values and Interval Preference Orderings

Uncertainty is a common phenomenon in our real world. Interval utility values and interval preference orderings are two of the simplest and most convenient tools to describe uncertain preferences in decision making. In this paper, we investigate consensus problems in group decision making with interval utility values and interval preference orderings. We first establish their transformation relations, and give a formula for calculating the association coefficients of individual uncertain preferences and group ones. We then develop a consensus procedure for group decision making with interval utility values and interval preference orderings, which takes interval utility values as the uniform preference representation. This procedure can be reduced to a series of processes for dealing with some special group decision making situations, such as: group decision making with utility values and preference orderings, group decision making with interval utility values, group decision making with interval preference orderings, etc. Finally, we illustrate the applications of the developed procedures with two practical examples.     

Study of Consumer Preferences in Regard to the Blonde Orange Cv. Washington Navel “Arancia Di Ribera PDO”

Consumers’ attitude and preferences in regard to food ingredients, country of origin, social corporate responsibility toward the environment, and work conditions have changed over the last 10 years. Consumers are getting more educated and therefore more sensitive around cultivation practices in agriculture and food processing, which increases concerns in regard to production practices in agriculture. Several studies have been conducted on consumers’ preferences about quality food, but not with regard to blonde oranges cv. Washington Navel cultivated in southern Italy. This quality fruit is a niche product that achieved the Protected Designation of Origin (PDO) certification for high organoleptic properties and fine taste. In this study, by a survey of 400 Italian consumers, we discovered preferences in regard to the cv. Washington Navel PDO (Riberella) attributes and revealed variables that may influence consumers’ purchasing behavior. Cluster analysis, based on respondents’ rates on 20 attributes, revealed preference segmentation. Freshness, taste, and origin were the most important attributes for consumers, following visual appearance and quality/price ratio. In responding to the demands of consumers for quality fresh fruit, information about quality standards and about the Riberella PDO is poor. Therefore, there may be potential to develop specific policies and marketing strategies to product the position in the international market.     

BEHAVIORAL PORTFOLIO SELECTION: ASYMPTOTICS AND STABILITY ALONG A SEQUENCE OF MODELS

We consider a sequence of financial markets that converges weakly in a suitable sense and maximize a behavioral preference functional in each market. For expected concave utilities, it is well known that the maximal expected utilities and the corresponding final positions converge to the corresponding quantities in the limit model. We prove similar results for nonconcave utilities and distorted expectations as employed in behavioral finance, and we illustrate by a counterexample that these results require a stronger notion of convergence of the underlying models compared to the concave utility maximization. We use the results to analyze the stability of behavioral portfolio selection problems and to provide numerically tractable methods to solve such problems in complete continuous‐time models.     

Information,individual errors,and collective performance: Empirical evidence on the Condorcet Jury Theorem

The Condorcet Jury Theorem implies that the collective performance of a group, in arriving at a “correct” judgment on the basis of majority or plurality rule, will be superior to the average performance of individual members of the group, if certain apparently plausible conditions hold. Variants of the Jury Theorem are reviewed, particularly including the politically relevant variant that allows for conflicting interests within the group. We then examine two kinds of empirical data. First, we compare individual and collective performance in a large number of multiple-choice tests, and we find that collective performance invariably and substantially exceeds average individual performance. Second, we analyze American National Election Study data to create dichotomous-choice tests concerning positions of candidates on a variety of political issues; Condorcet-like effects are again evident. Finally, continuing to use NES data, we construct, on each political issue, a simulated referendum (direct voting on the issue) and election (indirect voting on the issue by voting for candidates on the basis of their perceived positions on the issue), and we compare the two results. Despite high rates of individual error, electoral error is quite small, and collective performance is fairly high, providing evidence of Condorcet-like effects in situations of conflicting preferences.     

Direct Election of Group Decision-Makers Can Facilitate Cooperation in the Public Goods Game

Research on social dilemma has shown that the delegation of decision-making to group leaders can increase cooperation in the collective action problem. In this paper, we show that the voting scheme used for the election of leaders could make a difference to the emergence of cooperation. We design a public goods game experiment in which actors elect leaders to make decisions on their behalf in the contribution to public goods. In particular, we compare the leadership elected from direct and indirect election systems. In direct election, a leader is elected directly by majority-votes from a group, whereas in indirect election the group is divided into smaller subgroups and a leader is elected from the elected subgroup leaders. We run a simulation model to show that direct election would choose a more cooperative leader than indirect election when voters’ preferences of leadership are not homogenous. A laboratory experiment with human subjects further indicates that people hold stronger preferences for cooperators as leaders in direct election than in indirect election, suggesting that the voting scheme has an effect not only on the processing of actors’ preferences, but also on the shaping of their preferences of leadership in the public goods dilemma.