Escaping Arrow's Theorem: The Advantage-Standard Model

TL;DR

This paper introduces the Advantage-Standard (AS) model, a weaker condition than IIA, which allows for collective choice rules that escape Arrow's impossibility theorem, including transitive rules.

Contribution

The paper proposes the AS model that weakens IIA and negative transitivity, enabling the design of collective choice rules that avoid impossibility results.

Findings

Several appealing CCRs are AS representable.

Transitive CCRs can be represented under the AS model.

Joint weakening of IIA and negative transitivity avoids impossibility.

Abstract

There is an extensive literature in social choice theory studying the consequences of weakening the assumptions of Arrow's Impossibility Theorem. Much of this literature suggests that there is no escape from Arrow-style impossibility theorems, while remaining in an ordinal preference setting, unless one drastically violates the Independence of Irrelevant Alternatives (IIA). In this paper, we present a more positive outlook. We propose a model of comparing candidates in elections, which we call the Advantage-Standard (AS) model. The requirement that a collective choice rule (CCR) be representable by the AS model captures a key insight of IIA but is weaker than IIA; yet it is stronger than what is known in the literature as weak IIA (two profiles alike on $x,y$ cannot have opposite strict social preferences on $x$ and $y$). In addition to motivating violations of IIA, the AS model makes intelligible violations of another Arrovian assumption: the negative transitivity of the strict social preference relation $P$. While previous literature shows that only weakening IIA to weak IIA or only weakening negative transitivity of $P$ to acyclicity still leads to impossibility theorems, we show that jointly weakening IIA to AS representability and weakening negative transitivity of $P$ leads to no such impossibility theorems. Indeed, we show that several appealing CCRs are AS representable, including even transitive CCRs.