IDEAS home Printed from https://ideas.repec.org/p/oxf/wpaper/678.html
   My bibliography  Save this paper

The Dynamics of Delegated Decision Making

Author

Listed:
  • Kevin Roberts

Abstract

This paper investigates the behaviour of bodies or organizations, operating in a stochastic environment, where there is a delegated decision maker.A crucial decision is when to delegate to another decision maker. The problem may be intrapersonal, as occurs when there are endogenously changing tastes, or interpersonal where delegation is intuitionally necessay or where decison making is 'as if' there is delegation. This is possible if decision making is through voting - an existence theorem is given. Decisions lead to shifts in control involving option losses; forward-looking recognition of this leads to the endogenous creation of hysteresis. The fact that the behaviour of other agents leads to hysteresis makes it optimal for any single agent to introduce more hysteresis. Organisations or bodies with many possible decision makers operate, in subsets of the state space, in one of two regimes, one where hysteresis is small and the other where hysteresis is large.

Suggested Citation

  • Kevin Roberts, 2013. "The Dynamics of Delegated Decision Making," Economics Series Working Papers 678, University of Oxford, Department of Economics.
    • Handle: RePEc:oxf:wpaper:678
    as

    Download full text from publisher

    File URL: https://ora.ox.ac.uk/objects/uuid:6befeef6-878b-4b3f-852f-1352fef991b8
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Jack, William & Lagunoff, Roger, 2006. "Dynamic enfranchisement," Journal of Public Economics, Elsevier, vol. 90(4-5), pages 551-572, May.
    2. Roberts, Kevin W. S., 1977. "Voting over income tax schedules," Journal of Public Economics, Elsevier, vol. 8(3), pages 329-340, December.
    3. Benham, Lee & Keefer, Philip, 1991. "Voting in Firms: The Role of Agenda Control, Size and Voter Homogeneity," Economic Inquiry, Western Economic Association International, vol. 29(4), pages 706-719, October.
    4. David Laibson, 1997. "Golden Eggs and Hyperbolic Discounting," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(2), pages 443-478.
    5. Gans, Joshua S. & Smart, Michael, 1996. "Majority voting with single-crossing preferences," Journal of Public Economics, Elsevier, vol. 59(2), pages 219-237, February.
    6. R. H. Strotz, 1955. "Myopia and Inconsistency in Dynamic Utility Maximization," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 23(3), pages 165-180.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jack, William & Lagunoff, Roger, 2006. "Dynamic enfranchisement," Journal of Public Economics, Elsevier, vol. 90(4-5), pages 551-572, May.
    2. Lagunoff, Roger, 2009. "Dynamic stability and reform of political institutions," Games and Economic Behavior, Elsevier, vol. 67(2), pages 569-583, November.
    3. William Jack & Roger Lagunoff, 2006. "Social Conflict and Gradual Political Succession: An Illustrative Model," Scandinavian Journal of Economics, Wiley Blackwell, vol. 108(4), pages 703-725, December.
    4. Haavio, Markus & Kotakorpi, Kaisa, 2011. "The political economy of sin taxes," European Economic Review, Elsevier, vol. 55(4), pages 575-594, May.
    5. Roger Lagunoff, 2004. "The Dynamic Reform of Political Institutions," Econometric Society 2004 Latin American Meetings 47, Econometric Society.
    6. Roger Lagunoff, 2005. "Markov Equilibrium in Models of Dynamic Endogenous Political Institutions," Game Theory and Information 0501003, University Library of Munich, Germany.
    7. Persson, Torsten & Tabellini, Guido, 2002. "Political economics and public finance," Handbook of Public Economics, in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 3, chapter 24, pages 1549-1659, Elsevier.
    8. Kemptner, Daniel & Tolan, Songül, 2018. "The role of time preferences in educational decision making," Economics of Education Review, Elsevier, vol. 67(C), pages 25-39.
    9. Michael Kremer, 1997. "Why are Worker Cooperatives So Rare?," NBER Working Papers 6118, National Bureau of Economic Research, Inc.
    10. Brett, Craig & Weymark, John A., 2016. "Voting over selfishly optimal nonlinear income tax schedules with a minimum-utility constraint," Journal of Mathematical Economics, Elsevier, vol. 67(C), pages 18-31.
    11. Yu-Jui Huang & Adrien Nguyen-Huu, 2018. "Time-consistent stopping under decreasing impatience," Finance and Stochastics, Springer, vol. 22(1), pages 69-95, January.
    12. Jawwad Noor, 2005. "Choice and Normative Preference," Boston University - Department of Economics - Working Papers Series WP2005-039, Boston University - Department of Economics.
    13. Laureti, Carolina & Szafarz, Ariane, 2023. "Banking regulation and costless commitment contracts for time-inconsistent agents," Economic Modelling, Elsevier, vol. 129(C).
    14. Markus Haavio & Kaisa Kotakorpi, 2012. "Sin Licenses Revisited," CESifo Working Paper Series 4010, CESifo.
    15. An, Zhiyong, 2013. "An alternative approach to income taxation," Economic Modelling, Elsevier, vol. 30(C), pages 875-878.
    16. Uri Ben-Zion & Jan Pieter Krahnen & TAL SHAVIT, 2007. "Subjective Evaluation Of Delayed Risky Outcomes: An Experimental Approach," Working Papers 0709, Ben-Gurion University of the Negev, Department of Economics.
    17. Fahrenwaldt, Matthias Albrecht & Jensen, Ninna Reitzel & Steffensen, Mogens, 2020. "Nonrecursive separation of risk and time preferences," Journal of Mathematical Economics, Elsevier, vol. 90(C), pages 95-108.
    18. Groneck, Max & Ludwig, Alexander & Zimper, Alexander, 2016. "A life-cycle model with ambiguous survival beliefs," Journal of Economic Theory, Elsevier, vol. 162(C), pages 137-180.
    19. John Creedy, 2008. "Choosing the tax rate in a linear income tax structure," Australian Journal of Labour Economics (AJLE), Bankwest Curtin Economics Centre (BCEC), Curtin Business School, vol. 11(3), pages 257-276.
    20. Berliant, Marcus & Gouveia, Miguel, 2022. "On the Political Economy of Nonlinear Income Taxation," MPRA Paper 113140, University Library of Munich, Germany.

    More about this item

    Keywords

    Dynamic Voting; collective decisions; delegation; endogenous preferences; hysteresis;
    All these keywords.

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • D2 - Microeconomics - - Production and Organizations
    • D7 - Microeconomics - - Analysis of Collective Decision-Making

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oxf:wpaper:678. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Anne Pouliquen (email available below). General contact details of provider: https://edirc.repec.org/data/sfeixuk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.