Risk aversion, over-confidence and private information as determinants of majority thresholds

Abstract

We present and experimentally test a theoretical model of majority threshold determina-tion as a function of voters’ risk preferences. The experimental results confirm the theoreticalprediction of a positive correlation between the voter’s risk aversion and the corresponding preferredmajority threshold. Furthermore, the experimental results show that a voter’s preferred majoritythreshold negatively relates to the voter’s confidence about how others will vote. Moreover, ina treatment in which individuals receive a private signal about others’ voting behaviour, theconfidence-related motivation of behaviour loses ground to the signal’s strength.