Strategic and Secure Interactions in Networks

The goal of this dissertation is to understand how network plays a role in shaping certain strategic interactions, in particular biased voting and bargaining, on networks; and to understand how interactions can be made secure when they are constrained by the network topology. Our works take an interdisciplinary approach by drawing on theories and models from economics, sociology, as well as computer science, and using methodologies that include both theories and behavioral experiments. First, we consider biased voting in networks, which models distributed collective decision making processes where individuals on a network must balance between their private biases or preferences with a collective goal of consensus. Our study of this problem is two-folded. On the theoretical side, we start by introducing a diffusion model called biased voter model, which is a natural extension of the classic voter model. Among other results, we show in the presence of private biases, no matter how small, there exists certain networks where it takes exponential time to converge to a consensus through distributed interaction in networks. This is a stark and interesting contrast to the well-known result that it always takes polynomial time to converge in the voter model, when there are no private biases. On the experimental side, a group human subjects were arranged in various carefully designed virtual networks to solve the biased voting problem. Along with analyses of how collective and individual performance vary with network structure and incentives generally, we find there are well-studied network topologies in which the minority preference consistently wins globally, and that the presence of “extremist” individuals, or the awareness of opposing incentives, reliably improve collective performance Second, we consider bargaining in networks, which has long been studied by economists and sociologists. A basic premise behind the many theoretical study of bargaining in networks is that pure topological differences in agents’ network positions endow them with different bargaining power. As a complementary to these theories, we again conducted a series of highly controlled behavioral experiments, where human subjects were arranged in various carefully designed virtual networks to playing bargaining games. Along with other findings of how individual and collective performance vary with network structures and individual playing styles, we find that the number of neighbors one can negotiate with confers bargaining power, whereas the limit on the number of deals one can close undermines it, and we find that competitions from distant part of the network that are invisible locally also play a significant and subtle role in shaping bargaining powers. And last, we consider the question of how interactions in networks can be made secure. Traditional methods and tools from cryptography, for example secure multi-party computation, can be applied only if each party can talk to everyone else directly; but cannot be directly applied if interactions are distributed over a network without completely eradicating the distributed nature. We develop a general ‘compiler’ that turns each algorithm from a broad class collectively known as message-passing algorithms into a secure one that has exactly the same functionality and communication pattern. And we show a fundamental trade-off between preserving the distributed nature of communication and the level of security one can hope for

The Inter-Institutional Distribution of Power in EU Codecision

This paper analyzes the a priori influence of the European Parliament (EP) and the Council of Ministers (CM) on legislation of the European Union adopted under its codecision procedure. In contrast to studies which use conventional power indices, both institutions are assumed to act strategically. Predicted bargaining outcomes of the crucial Conciliation stage of codecision are shown to be strongly biased towards the legislative status quo. Making symmetric preference assumptions for members of CM and EP, CM is on average much more conservative because of its internal qualified majority rule. This makes CM by an order of magnitude more influential than EP, in contrast to a seeming formal parity between the two ‘co-legislators’.power measurement, European Union codecision procedure, bargaining, spatial voting, decision procedures

The Determination of Employee Representatives

Plant species differ in their ability to transform available resources to biomass and to respond in a plastic way to environmental circumstances; we hypothesized that such differences among four weed taxa of Papaver would explain differences in their competitive response. We first compared two populations each of Papaver rhoeasL., P.dubiumL. ssp. dubium, P.dubiumL. ssp. lecoqii (Lamotte) Syme and P.argemoneL., grown in a greenhouse for 6 weeks in a nutrient gradient combined with two light treatments to elucidate possible differences in responses. As there were clear differences, a second experiment evaluated whether these differences also meant differences in competitive response, during early growth, when tested against two crops (wheat, rape). The assumption that competitive response was linked to the ability to transform nutrient and light to biomass was not supported: even though differences in extent of plasticity existed, the effect of competition was similar for the taxa. Thus, higher plasticity and ability to transform available recourses to biomass did not lead to stronger competitiveness for Papaver during early growth

International organisation analysed with the power index method

The period of globalisation has seen more and more of international and regional organisation. Setting up an organisation with a group of state entails a resolution to the following two questions: (1) How are votes to be allocated? (2) What aggregation rule is to be employed? International and regional organisations display some interesting differences in how they have approached these two questions choosing a regime. The power index framework offers a convenient method for analysing these constitutional differences. It may be linked with the basic framework in constitutional economics – Wicksell’s classic approach, which entails that players very much use their preferences for the power to act and the power to prevent action when deciding the regime to be employed

Proposal Rights and Political Power

In a canonical model of sequential collective bargaining over a divisible good we show that equilibrium expected payoffs are not restricted by players’ voting rights or their impatience. For all monotonic voting rules and discount factors, and for all divisions of the good among players, there exists a stationary proposal-making rule such that this division represents players’ expected payoffs in a Stationary Subgame Perfect Nash equilibrium in pure strategies. The result attests to the significance of proposal rights in determining political power in collective deliberations.Power, Proposal Rights, Voting Rights.

Social preferences, accountability, and wage bargaining

We assess the extent of preferences for employment in a collective wage bargaining situation with heterogeneous workers. We vary the size of the union and introduce a treatment mechanism transforming the voting game into an individual allocation task. Our results show that highly productive workers do not take employment of low productive workers into account when making wage proposals, regardless of whether insiders determine the wage or all workers. The level of pro-social preferences is small in the voting game, while it increases as the game is transformed into an individual allocation task. We interpret this as an accountability effect

Bargaining and Distribution of Power in the EU's Conciliation Committee

The European Union (EU) has moved towards bicameralism, making the codecision procedure its most important mechanism for decision making. To gauge if European Parliament (EP) and Council of Ministers (CM) are equally powerful ‘codecision makers’, understanding of the final stage of the procedure – bargaining in the Conciliation Committee – is crucial. Here, EP and CM are assumed to have spatial preferences determined by their respective internal decision mechanisms. Applying bargaining theory to predict inter-institutional agreements in the Conciliation Committee, it turns out that although institutionally the Council and the Parliament are seemingly in a symmetric position, CM has significantly greater influence on EU legislation.European Union codecision procedure, Conciliation Committee, bargaining, spatial voting, decision procedures