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  3. American Economic Review
  4. May 2013
  5. Aggregating Local Preferences to Guide Marginal Policy Adjustments

American Economic Review

ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)

Aggregating Local Preferences to Guide Marginal Policy Adjustments

  • Daniel J. Benjamin
  • Ori Heffetz
  • Miles S. Kimball
  • Nichole Szembrot
American Economic Review
vol. 103, no. 3, May 2013
(pp. 605–10)
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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.

Citation

Benjamin, Daniel J., Ori Heffetz, Miles S. Kimball, and Nichole Szembrot. 2013. "Aggregating Local Preferences to Guide Marginal Policy Adjustments." American Economic Review, 103 (3): 605–10. DOI: 10.1257/aer.103.3.605

Additional Materials

JEL Classification

  • E61 Policy Objectives; Policy Designs and Consistency; Policy Coordination
  • I31 General Welfare