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The theory of committees and elections
595
Book reviews
electronics, there is no such neglect by European companies for ASEAN countries, when choosing a site for labor-intensive production. They also make the interesting point that, as most of intra-EEC trades is of the intraindustry, or Linder type, there is no clamor for protection, as contrasted with the inter-industry specialization between developing and developed countries (p. 92). The authors feel apparently that the ‘fortress EEC’ thesis has some validity, and, in line with the Kiel liberal credo, denounce the growthinhibiting effects of protectionism (p. 103-104). As the above suggests, this is a small book with much added value, in terms of useful insights. Accordingly critical noises from this reviewer are few. The persistence of non-tariff barriers within the EEC (at least until 1992) could have been mentioned to explain the still very high degree of orientation of European FDI to other EEC-countries. Besides, a clearer and more systematic distinction between two types of FDI, namely (a) that catering to the market potential of the host countries and (b) that looking for an export base for labor-intensive goods would, at times, have avoided potential confusion. With respect to the first type of investment, the contention (e.g. on p. 63) that all FDI are competing amongst each other, is somewhat overdrawn. Admittedly, multinationals can only allocate their resources once. But decisions about alternative ventures are not made as neatly and as rationally as handbooks on capital budgeting prescribe. When a foreign market holds potential (such as ASEAN countries), oligopolistic competition induces larger multinationals to establish affiliates in such countries as documented, years ago, by Knickerbocker. Smaller MNE are almost certainly less tempted to set up ventures in far-away countries, such as ASEAN one?. On the whole, a smaller number of giant MNE are headquartered in the EEC than in the U.S.A. This factor may also contribute towards explaining the lesser involvement of EEC firms within ASEAN.
University
Duncan Black, The Theory Publishers, 1987).
of Committees
and Elections
Sylvain Plasschaert of Antwerp (UFSIA)
(Kluwer
Academic
The paradox of voting is the coexistence of coherent individual valuations of alternatives (or candidates, etc.) and a collective incoherent choice by majority rule. Late in the 18th century, just when voting was becoming a frequently used method of social choice, Borda and Condorcet discovered the paradox of voting. This discovery made precious little impression on their contemporaries, however.
596
Book reviews
The paradox was rediscovered 100 years later by Dodgson (Lewis Carroll) and Nanson, a theorist of proportional representation. It remained for Duncan Black, however, to realize the deep theoretical significance of the paradox and to communicate its importance to other scholars. His essays of the late 1940s which are summarized in The Theory of Committees and Elections and in the book coauthored with R.A. Newing (1951) brought the subject of social choice into the very center of political thought. And, of course, Kenneth Arrow’s seminal work: Social Choice and Individual Value (1951), in which it is demonstrated that the paradox may occur in any reasonably fair system of counting votes, guaranteed that it would stay there. Strange as it may seem, a theory of voting had barely existed until the 1950s. (The history of the paradox up till the 1940s is contained in Black’s book together with three Dodgson pamphlets.) Clearly one sufficient condition for a transitive social outcome is that a majority of choosers rank the same alternative highest. Failing such an obvious condition, undoubtedly the most well-known and indeed most immediately useful condition of sufficiency is Black’s notion of singlepeakedness. Black noted that when candidates are linearly ordered and the agents’ preferences are single-peaked with respect to that ordering, then a Condorcet winner - an alternative beating all rivals in pairwise comparisons _ exists and yields a strategy-proof voting rule. Black thus takes into account the strategic behavior of the electoral body, although the treatment is elementary; the necessary game theory concepts were not yet developed in the 1940s. Duncan Black’s book will be remembered as a truly pioneering work leading to a reawakened interest in formal political analysis. Black’s classic exposition of the problem of collective choice is still a good introduction to the subject, although by now there exists good introductory texts such as Kelly’s Social Choice Theory (1988). It is a very laudable initiative by Kluwer to bring this reprinting (the fourth since the publication of the book in 1958) of a social science classic on the market.
University
Sven Berg of Lund
Stephen Davies, Bruce Lyons with Huw Dixon, Paul Geroski, Economics of London and New York, 1988) pp. Industrial Organization (Longman, viii +248, ISBN-0-582-29567-X, E17.50. This book has arrived at an appropriate time and will certainly fulfill a need, since a comprehensive assessment of recent developments in Industrial Organization (IO) seemed due. The field of IO underwent rapid changes in
Book reviews
electronics, there is no such neglect by European companies for ASEAN countries, when choosing a site for labor-intensive production. They also make the interesting point that, as most of intra-EEC trades is of the intraindustry, or Linder type, there is no clamor for protection, as contrasted with the inter-industry specialization between developing and developed countries (p. 92). The authors feel apparently that the ‘fortress EEC’ thesis has some validity, and, in line with the Kiel liberal credo, denounce the growthinhibiting effects of protectionism (p. 103-104). As the above suggests, this is a small book with much added value, in terms of useful insights. Accordingly critical noises from this reviewer are few. The persistence of non-tariff barriers within the EEC (at least until 1992) could have been mentioned to explain the still very high degree of orientation of European FDI to other EEC-countries. Besides, a clearer and more systematic distinction between two types of FDI, namely (a) that catering to the market potential of the host countries and (b) that looking for an export base for labor-intensive goods would, at times, have avoided potential confusion. With respect to the first type of investment, the contention (e.g. on p. 63) that all FDI are competing amongst each other, is somewhat overdrawn. Admittedly, multinationals can only allocate their resources once. But decisions about alternative ventures are not made as neatly and as rationally as handbooks on capital budgeting prescribe. When a foreign market holds potential (such as ASEAN countries), oligopolistic competition induces larger multinationals to establish affiliates in such countries as documented, years ago, by Knickerbocker. Smaller MNE are almost certainly less tempted to set up ventures in far-away countries, such as ASEAN one?. On the whole, a smaller number of giant MNE are headquartered in the EEC than in the U.S.A. This factor may also contribute towards explaining the lesser involvement of EEC firms within ASEAN.
University
Duncan Black, The Theory Publishers, 1987).
of Committees
and Elections
Sylvain Plasschaert of Antwerp (UFSIA)
(Kluwer
Academic
The paradox of voting is the coexistence of coherent individual valuations of alternatives (or candidates, etc.) and a collective incoherent choice by majority rule. Late in the 18th century, just when voting was becoming a frequently used method of social choice, Borda and Condorcet discovered the paradox of voting. This discovery made precious little impression on their contemporaries, however.
596
Book reviews
The paradox was rediscovered 100 years later by Dodgson (Lewis Carroll) and Nanson, a theorist of proportional representation. It remained for Duncan Black, however, to realize the deep theoretical significance of the paradox and to communicate its importance to other scholars. His essays of the late 1940s which are summarized in The Theory of Committees and Elections and in the book coauthored with R.A. Newing (1951) brought the subject of social choice into the very center of political thought. And, of course, Kenneth Arrow’s seminal work: Social Choice and Individual Value (1951), in which it is demonstrated that the paradox may occur in any reasonably fair system of counting votes, guaranteed that it would stay there. Strange as it may seem, a theory of voting had barely existed until the 1950s. (The history of the paradox up till the 1940s is contained in Black’s book together with three Dodgson pamphlets.) Clearly one sufficient condition for a transitive social outcome is that a majority of choosers rank the same alternative highest. Failing such an obvious condition, undoubtedly the most well-known and indeed most immediately useful condition of sufficiency is Black’s notion of singlepeakedness. Black noted that when candidates are linearly ordered and the agents’ preferences are single-peaked with respect to that ordering, then a Condorcet winner - an alternative beating all rivals in pairwise comparisons _ exists and yields a strategy-proof voting rule. Black thus takes into account the strategic behavior of the electoral body, although the treatment is elementary; the necessary game theory concepts were not yet developed in the 1940s. Duncan Black’s book will be remembered as a truly pioneering work leading to a reawakened interest in formal political analysis. Black’s classic exposition of the problem of collective choice is still a good introduction to the subject, although by now there exists good introductory texts such as Kelly’s Social Choice Theory (1988). It is a very laudable initiative by Kluwer to bring this reprinting (the fourth since the publication of the book in 1958) of a social science classic on the market.
University
Sven Berg of Lund
Stephen Davies, Bruce Lyons with Huw Dixon, Paul Geroski, Economics of London and New York, 1988) pp. Industrial Organization (Longman, viii +248, ISBN-0-582-29567-X, E17.50. This book has arrived at an appropriate time and will certainly fulfill a need, since a comprehensive assessment of recent developments in Industrial Organization (IO) seemed due. The field of IO underwent rapid changes in