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Information Aggregation and Optimal Structure of the Executive

Author

Listed:
  • Torun Dewan
  • Andrea Galeotti
  • Christian Ghiglino
  • Francesco Squintani

Abstract

We model two aspects of executives in parliamentary democracies: Decision‐making authority is assigned to individuals, and private information is aggregated through communication. When information is relevant to all policies and communication is private, all decisions should be centralized to a single politician. A government that holds cabinet meetings, where information is made available to all decision makers, outperforms one where communication is private: A multimember cabinet can be optimal; it need not be single peaked around the most moderate politician or ideologically connected. Centralization is nonmonotonic in the degree of ideological divergence. In a large cabinet, all power should be given to the most moderate politician. Even when uncertainty is policy specific and a single politician is informed on each policy, power should never be fully decentralized. Our model provides a justification for centralized authority and cabinet meetings that enhance the quality of policy.

Suggested Citation

  • Torun Dewan & Andrea Galeotti & Christian Ghiglino & Francesco Squintani, 2015. "Information Aggregation and Optimal Structure of the Executive," American Journal of Political Science, John Wiley & Sons, vol. 59(2), pages 475-494, February.
    • Handle: RePEc:wly:amposc:v:59:y:2015:i:2:p:475-494
    DOI: 10.1111/ajps.12121
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    Cited by:

    1. Daniel Habermacher, 2022. "Information Aggregation in Multidimensional Cheap Talk," Working Papers 169, Red Nacional de Investigadores en Economía (RedNIE).
    2. Gieczewski, Germán, 2022. "Verifiable communication on networks," Journal of Economic Theory, Elsevier, vol. 204(C).
    3. Migrow, Dimitri, 2021. "Designing communication hierarchies," Journal of Economic Theory, Elsevier, vol. 198(C).
    4. Daniel Habermacher, 2022. "Authority and Specialization under Informational Interdependence," Working Papers 142, Red Nacional de Investigadores en Economía (RedNIE).
    5. Raghul S Venkatesh, 2018. "On Information Aggregation in International Alliances," AMSE Working Papers 1855, Aix-Marseille School of Economics, France, revised Jul 2019.
    6. Furukawa, Chishio, 2019. "Publication Bias under Aggregation Frictions: Theory, Evidence, and a New Correction Method," EconStor Preprints 194798, ZBW - Leibniz Information Centre for Economics.

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