Question

Consider the ethical-voter model, but suppose that the density

of μ is f(μ) = 2μ on [0,1].
Derive the equilibrium cut-off levels for both groups. (You can
check the answer in the lecture
slides.)

Answer 1

The ethical-voter model considers the behavior of voters based on their moral values and principles. The equilibrium cut-off levels for both groups can be derived by finding the values of μ at which the groups are indifferent between voting for a policy or not.

Step-by-step explanation:

The ethical-voter model refers to a model in economics that considers the behavior of voters based on their moral values and principles. In this case, the model assumes that the density of μ, denoted as f(μ), is equal to 2μ on the interval [0,1]. To derive the equilibrium cut-off levels for both groups, we need to find the values of μ at which the groups are indifferent between voting for a policy or not.

In the ethical-voter model, each voter has a cut-off point or threshold, denoted as μ, which represents the level of policy favorability that they are willing to support. If the policy favorability level is above μ, the voter will support the policy; otherwise, they will not.

To determine the equilibrium cut-off levels for both groups, we need to find the values of μ at which the groups are indifferent between voting for the policy and not voting. Mathematically, this is the point at which the expected utility of voting for the policy equals the expected utility of not voting.