Prof.

Yeim Kutepeli ECO 4413 Game Theory

VOTING GAMES

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OUTLINE

Prof. Yeim Kutepeli ECO 4413 Game Theory

Choosing Among Voting Mechanisms
Majority Rule with Two Choices

Plurality Rule and the Condorcet Candidate

A Modified Plurality Rule: The Single

Transferable Vote
Strategic Voting with Plurality Rule

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 The individual is a consumer: individuals
demand a variety of consumption goods
and services from which they drive
welfare.
The individual provides productive

Theory
Prof. Yeim Kutepeli ECO 4413 Game
services: the most obvious resource
provided by the individual is labor.
The individual participates in the
political process: by voting and other
political activities, the individual
expresses his or her preferences regarding
the governments provision of goods and
services.
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 The acceptance or rejection by a
corporations broad of directors of merger
offer tendered by competing firm.

Theacceptance or rejection by a unions

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Prof. Yeim Kutepeli ECO 4413 Game
rank and file of the labor contract
negotiated by unions officers.

Theacceptance or rejection by a states

voters of proposal to issue new bonds with
which to build new roads and bridges.
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 The outcome of any vote depends on the
voting rules and the ballots submitted by
voters. Voting is a type of game and
amenable to game theoretical analysis.

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Prof. Yeim Kutepeli ECO 4413 Game
Ifthe secret ballots are used, then the
voters are playing a static game.

Strategicallysophisticated voter realize

that it may not always be optimal to vote
sincerely.

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TWO DIFFERENT MODELS OF
VOTER:
Naive voter: he always casts his ballot honestly,
even when it is not in his best interest to do so.

Theory
Prof. Yeim Kutepeli ECO 4413 Game
Strategic voter: she always casts her ballot so as
to obtain the best outcome possible given her
information, the voting rules, and her beliefs
about how the other voters will behave.

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CHOOSING AMONG VOTING
MECHANISMS
Plurality voting: ballots are prepared which
voters choose only one of the candidate and
vote for him.

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Prof. Yeim Kutepeli ECO 4413 Game
After the election, these ballots are tallied
(counted) and the person receiving the largest
number of votes is declared the winner.

This voting mechanism most commonly used

to make public decision or to elect political
candidates.

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 Approval voting: voters could be allowed to
vote for as many candidates as they approve of.
The ballots are tallied and the candidate
receiving the highest number of approval votes
is declared the winner.

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Prof. Yeim Kutepeli ECO 4413 Game
Social choice mechanism (SCM): voting is
just one procedure the members of a group could
use to from a collective ranking of a group of
candidates on the basis of their individual
rankings. We will refer to any such mechanism
as a Social choice mechanism

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 ARROWS IMPOSSIBILITY
THEOREM:
There is no social choice mechanism that
simultaneously satisfies the Pareto condition ,
the independence of irrelevant alternatives

Theory
Prof. Yeim Kutepeli ECO 4413 Game
condition, and the transitivity with unlimited
domain condition, and is also non-dictatorial.

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ARROWS REQUIREMENTS:
1) No candidate is ranked higher by every member of the group
than the candidate ranked highest by SCM.

2) The ranking provided by the SCM is always complete and

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Prof. Yeim Kutepeli ECO 4413 Game
transitive whenever the ranking of every member of the
group is complete and transitive.

3) The relative ranking of any two candidates provided by the

SCM depends on only the individual rankings. It does not
depend on how these two candidates are ranked against
any other candidates.

4) The SCM is not a dictatorship. There is no individual whose

ranking always matches the ranking of the SCM,
whatever the ranking of the other members of the group
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MAJORITY RULE WITH TWO
CHOICES

Majority rule: the winner is the candidate

who receives more than half of the votes cast.
And the winner of election is that candidate

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Prof. Yeim Kutepeli ECO 4413 Game
who receives the most votes.

In an election between two candidates

decided by a majority rule, all voters will
rationally abstain or vote honestly for their
most preferred candidate.

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WE WILL STUDY THE BEHAVIOR
OF VOTING RULES ASSUMING
THAT:
all voters are well informed
their preferences are common knowledge

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Prof. Yeim Kutepeli ECO 4413 Game
they take voting mechanism

the slate of candidates as given

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CANDIDATE AND VOTER
LOCATIONS ON LEFT-TO-RIGHT
SCALE

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Prof. Yeim Kutepeli ECO 4413 Game
Location of voter
Location of
candidate A Location of
candidate B

0 0,30 0,39 1
0,35

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 Candidate Position Game: the candidates are
assumed to choose their positions simultaneously
and cannot budge from that choice once it is made.
We will also suppose that voter preferences and
candidates objectives are common knowledge. We
will refer to the resulting game as the Candidate

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Prof. Yeim Kutepeli ECO 4413 Game
Position Game.

Positioning at 0.50 is a weakly dominant strategy

for both candidates, and so both candidates
positioning themselves at 0.50. This is also the
unique Nash equilibrium for this game.

0.50 is the position of the median voter. candidates

positions converge to the position of the median
voter.
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 The Median Voter Theorem: if there
are two candidates, the two candidates
political positions can be represented by
their location on a continuous linear
scale, each voters preference over these
positions is singe-peaked, the distribution

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Prof. Yeim Kutepeli ECO 4413 Game
of voter preferences is common
knowledge, and the election is decided by
majority rule; then the unique Nash
equilibrium strategy in the Candidate
position game is both candidates to
position themselves at the median voters
position.
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 DISTRIBUTION OF VOTER
PREFERENCES

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Prof. Yeim Kutepeli ECO 4413 Game
Voter
position 0.0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1.0

Number of
voters 36 15 10 8 5 3 1 2 3 5 13

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PLURALITY RULE AND THE
CONDORCET CANDIDATE
A candidate who is preferred by a majority of
voters to any other alternative in a series of
pairwise comparisons is called condorcet

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Prof. Yeim Kutepeli ECO 4413 Game
candidate after the Marquis de Condorcet
(French mathematician and philosopher 1743-
1794).

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HYPOTHETICAL VOTER
PREFERENCE
Voter Number of voters
preference
type with that type

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Prof. Yeim Kutepeli ECO 4413 Game
A 95 b>d>e
B 95 d>b>e
C 110 e>b>d

Cyclical majority: no one

candidate can muster a majority of
votes against all alternatives,
hence there is no Condorcet
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candidate.
Voter Preferences That Produce No Condorcet
Candidate

Voter Number of voters

preference
type with that type

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Prof. Yeim Kutepeli ECO 4413 Game
A 1 x>y>z
B 1 y>z>x
C 1 z>x>y

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 Single transferable vote: voters are given a
slate of candidates and are asked to vote for one.
if no one candidate receives a majority of the
votes cast, a second ballot is taken in which the
candidate receiving the smallest number of votes
from the first ballot dropped from the list of

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Prof. Yeim Kutepeli ECO 4413 Game
eligible candidates.

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SHAREHOLDER
PREFERENCES
Number of
Voter Preference
Shares/voters

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Prof. Yeim Kutepeli ECO 4413 Game
A 8 z>y>x
B 7 x>z>y
C 6 y>x>z
D 3 y>z>x

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THE OUTCOME OF THE
ELECTION AS BS VOTE
CHANGES WHEN THE OTHER
VoterARE
Bs Ballot
HONESTWinner

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Prof. Yeim Kutepeli ECO 4413 Game
VOTERS

x>z>y (honest) Z
x>y>z Y
z>x>y Z
z>y>x Z
y>x>z Y
y>z>x Y

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STRATEGIC VOTING WITH
PLURALITY RULE
Chairmans paradox: one member of a
committee -the chairman is given the
power to break ties. the resulting plurality-

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Prof. Yeim Kutepeli ECO 4413 Game
rule voting game has a unique iterated
dominant strategy equilibrium whose
outcome is the one considered the worst by
the powerful chairman.

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AN EXAMPLE

Three professors at economics department, Ms.

Aye, Ms. Fatma , and Mr. Ali , have been asked
by the economics department to choose the
mathematics requirement for economics major.

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Prof. Yeim Kutepeli ECO 4413 Game
There are considering three options.
require no math courses for students majoring in
economics. L (low requirement)
require one term of Univariate calculus. M
(medium requirement)
require two terms of calculus: one of Univariate
calculus and one of multivariate. H (high
requirement)

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 VOTER PREFERENCES
voter preferences One of the
Ms. Aye L > M >H committee members,
Mr. Ali H > L >M Ms. Aye, has been

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Prof. Yeim Kutepeli ECO 4413 Game
Ms. Fatma M > H >L designated the Chair
of committee.
The chair carries the power to cast a tie-
breaking vote. It is more likely that Ms. Ayes
preferred outcome will be chosen. This
institution is confirmed by the nave model.

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THE NAVE VOTING
MODEL
If all three members of the committee vote
naively, then the outcome of vote is
straightforward and intuitive:

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Prof. Yeim Kutepeli ECO 4413 Game
Ms. Aye L L is chosen by the
Ms. Fatma M committee and
Mr. Ali H economics majors
will not be required
to take any math
course.
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THE STRATEGIC VOTING
MODEL

Strategic voting behavior: the game essentially

reduces to a static game in which the set of

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Prof. Yeim Kutepeli ECO 4413 Game
strategies and the set of moves coincide. The
concept we will employ to make predictions about
Strategic voting behavior is Nash equilibrium.
But, if we can find dominant strategies and
iterated dominant strategies, we will use them as
our predictors. Because of Ms. Ayes voting power,
it is likely that he has dominated strategies that
can be removed from the game.

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 Consider Ms. Ayes best response to every possible
pair of votes by Ms. Fatma and Mr. Ali.

If Ms. Fatma and Mr. Ali vote for the same

candidate, then Ms. Aye s vote is irrelevant and

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Prof. Yeim Kutepeli ECO 4413 Game
all three of Ms. Ayes strategies are equally good.

If Ms. Fatma and Mr. Ali split their vote, then Ms.
Ayes vote determines the outcome. Hence Ms.
Aye has a weakly dominant strategy of voting for
L. we would predict, and so presumably would Ms.
Fatma and Mr. Ali, that he will vote for L.
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 PAYOFF MATRIX ASSUMING MS.
AYE VOTES FOR L

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Prof. Yeim Kutepeli ECO 4413 Game
Ms. Fatmas vote

H M L

Mr. H (Best, Middle, worst) (Middle, worst best,) (Middle, worst, best)
Alis
vote M (middle, worst, best) (worst, Best, middle) (Middle, worst, best)
L (middle, Worst, best) (Middle, Worst, best) (Middle, Worst, best)

Payoffs: Mr. Ali, Ms. Fatma and Ms. Aye

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PAYOFF MATRIX ASSUMING MS. AYE
VOTES FOR L AND MS. FATMA DOES
NOT VOTE FOR L

Ms. Fatmas vote

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Prof. Yeim Kutepeli ECO 4413 Game
H M

Mr. Alis H (Best, Middle, worst) (Middle, worst best,)

vote
M (middle, worst, best) (worst, Best, middle)
L (middle, Worst, best) (Middle, Worst, best)

Payoffs: Mr. Ali, Ms. Fatma and Ms. Aye

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PAYOFF MATRIX ASSUMING MS. AYE
VOTES FOR L, MS. FATMA DOES NOT
VOTE FOR L, AND MR. ALI VOTES FOR
H

Theory
Prof. Yeim Kutepeli ECO 4413 Game
Ms. Fatmas vote

H M
Mr. Alis
vote (Best, Middle,
H (Middle, worst best,)
worst)

Payoffs: Mr. Ali, Ms. Fatma and Ms. Aye

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 H wins, even though the Chair of the committee,
Ms. Aye, considers this his worst outcome. The
power to break ties turns out to be a bad thing for
the person who is unlucky enough to be saddled
with it. Oddly enough, once the committee is
assigned, there should be a fight among the
members not to be chosen as Chair, even though

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Prof. Yeim Kutepeli ECO 4413 Game
the Chair brings with it extra voting privileges.

Of course, what drives the result is that Ms. Fatma

does not vote naively. she recognizes that if she
were to do so, then she would end up with what
she considers to be the worst outcome. Therefore,
she votes strategically.

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