Collective economic decisions and the discursive dilemma

Most economic decisions involve judgments. When decisions are taken collectively, various judgment aggregation problems may occur. Here we consider an aggregation problem called the "discursive dilemma", which is characterized by an inconsistency between the aggregate judgment on the premises for a conclusion and the aggregate judgment on the conclusion itself. It thus matter for the decision whether the group uses a premise- or a conclusion-based decisionmaking procedure. The current literature, primarily within jurisprudence, philosophy, and social choice, consider aggregation of qualitative judgments on propositions. Most economic decisions, however, involve quantitative judgments on economic variables. We develop a framework that is suitable for analyzing the relevance of the discursive dilemma for economic decisions. Assuming that decisions are reached either through majority voting or by averaging, we find that the dilemma cannot be ruled out, except under some restrictive assumptions about the relationship between the premise-variables and the conclusion.Collective economic decisions, Judgement aggregation, Inconsistency

The Discursive Dilemma in Monetary Policy

The discursive dilemma implies that the policy decision of a board of policymakers depends on whether the board reaches the decision by voting directly on policy (conclusion-based procedure), or by voting on the premises for the decision (premise-based procedure). We derive results showing when the discursive dilemma may occur, both in a general model and in a standard monetary policy model. When the board aggregates by majority voting, a discursive dilemma can occur if either (i) the relationship between the premise and the decision is non- monotonic, or (ii) if the board members have di¤erent judgments on at least two of the premises. Normatively, a premise-based procedure tends to give better decisions when there is disagreement on parameters of the model.Discursive dilemma; Monetary policy; MPC; Policy boards

Atom--Molecule Coherence in a Bose-Einstein Condensate

Coherent coupling between atoms and molecules in a Bose-Einstein condensate (BEC) has been observed. Oscillations between atomic and molecular states were excited by sudden changes in the magnetic field near a Feshbach resonance and persisted for many periods of the oscillation. The oscillation frequency was measured over a large range of magnetic fields and is in excellent quantitative agreement with the energy difference between the colliding atom threshold energy and the energy of the bound molecular state. This agreement indicates that we have created a quantum superposition of atoms and diatomic molecules, which are chemically different species.Comment: 7 pages, 6 figure

Consequences of pacing the Pleistocene 100 kyr ice ages by nonlinear phase locking to Milankovitch forcing

Author Posting. © American Geophysical Union, 2006. This article is posted here by permission of American Geophysical Union for personal use, not for redistribution. The definitive version was published in Paleoceanography 21 (2006): PA4206, doi:10.1029/2005PA001241.The consequences of the hypothesis that Milankovitch forcing affects the phase (e.g., termination times) of the 100 kyr glacial cycles via a mechanism known as “nonlinear phase locking” are examined. Phase locking provides a mechanism by which Milankovitch forcing can act as the “pacemaker” of the glacial cycles. Nonlinear phase locking can determine the timing of the major deglaciations, nearly independently of the specific mechanism or model that is responsible for these cycles as long as this mechanism is suitably nonlinear. A consequence of this is that the fit of a certain model output to the observed ice volume record cannot be used as an indication that the glacial mechanism in this model is necessarily correct. Phase locking to obliquity and possibly precession variations is distinct from mechanisms relying on a linear or nonlinear amplification of the eccentricity forcing. Nonlinear phase locking may determine the phase of the glacial cycles even in the presence of noise in the climate system and can be effective at setting glacial termination times even when the precession and obliquity bands account only for a small portion of the total power of an ice volume record. Nonlinear phase locking can also result in the observed “quantization” of the glacial period into multiples of the obliquity or precession periods.E.T. is funded by NSF Paleoclimate program, grant ATM-0455470 and by the McDonnell Foundation. P.H. is supported by the NOAA Postdoctoral Program in Climate and Global Change. C.W. is supported by the National Ocean Partnership Program (NOPP). M.E.R. is supported by NSF grant ATM-0455328

Comparing Monetary Policy Transparency. The Eijffinger and Geraats Index - a Comment

There is by now a large volume of literature on central bank transparency and communication. One branch of this literature compares transparency across central banks and over time. Recent contributions in this vein are Eijffinger and Geraats (2006), Dincer and Eichengreen (2007), and Geraats (2008), who all use an index developed by Eijffinger and Geraats (2006). In this note I argue that the index can be very misleading. The argument is illustrated by the case of Norway, which has received a relatively low score on the index

Four essays on the political economy of economic reform

This thesis provides political-economy explanations for the prevalence of inefficient government policies. Possible solutions to the problem of non-adoption of efficient policies are also provided. Understanding why inefficient government policies exist, and how they may be reformed, is key in the field of political economy. A leading example is trade policies, where the reality of most countries’ policies is so blatantly contrary to all the normative prescriptions of the economist that there seems to be no way to understand it except by delving into the politics. Labor market policies provide other examples. The recent wave of economic reforms has heightened the interest in these questions. The thesis is part of Claussen’s Dr. Polit exam at the University of Oslo. Claussen defended the thesis on March 24, 2003

The Discursive Dilemma in Monetary Policy

The discursive dilemma implies that the policy decision of a board of policymakers depends on whether the board reaches the decision by voting directly on policy (conclusion-based procedure), or by voting on the premises for the decision (premise-based procedure). We derive results showing when the discursive dilemma may occur, both in a general model and in a standard monetary policy model. When the board aggregates by majority voting, a discursive dilemma can occur if either (i) the relationship between the premise and the decision is non-monotonic, or (ii) if the board members have different judgments on at least two of the premises. Normatively, a premise-based procedure tends to give better decisions when there is disagreement on parameters of the model.publishedVersio

Explaining the Low US Inflation – Coincidence or “New Economy”? Evidence Based on a Wage-Price Spiral

We study possible factors behind the subdued inflation in the United States since the mid-1990s. A standard expectations-augmented Phillips curve does not exhibit structural breaks. However, a wage-price spiral comprising wage growth, consumer price inflation and producer price inflation shows an otherwise unexplained downward shift in CPI inflation since the mid-1990s. We estimate this downward shift to be approximately 1 percentage point since 1994. The result emerges in spite of a large number of explanatory variables and seems to reflect deep structural changes of the economy. Counterfactual simulation of the wage-price spiral shows that the low level of U.S. inflation during the late 1990s stems from coincidental favourable shocks as well as factors that may reflect new economy developments.publishedVersio