American Economic Review Vol. 103 No. 3 2013

Aggregating Local Preferences to Guide Marginal Policy Adjustments

Daniel J. Benjamin¹; Ori Heffetz²; Miles Kimball³; Nichole Szembrot⁴

¹ Department of Economics, Cornell University, 480 Uris Hall, Ithaca, NY 14853 and NBER. · ² SC Johnson Graduate School of Management, Cornell University, 324 Sage Hall, Ithaca, NY 14853. · ³ Department of Economics, University of Michigan, 312 Lorch Hall, Ann Arbor, MI 48109 and NBER. · ⁴ Department of Economics, Cornell University, 455 Uris Hall, Ithaca, NY 14853.

Abstract

We propose a social choice rule for aggregating preferences elicited from surveys into a marginal adjustment of policy from the status quo. The mechanism is: (i) symmetric in its treatment of survey respondents; (ii) ordinal, using only the orientation of respondents' indifference surfaces; (iii) local, using only preferences in the neighborhood of current policy; and (iv) what we call “first-order strategy-proof,” making the gains from misreporting preferences second order. The mechanism could be applied to guide policy based on how policy affects responses to subjective well-being surveys.

DOI

10.1257/aer.103.3.605

Volume

103

Issue

3

Pages

605-610

Language

en

Sources

bibtex:phds-export.bib crossref openalex

Cite

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