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Ignorance and bias in collective decision:Theory and experiments

Author

Listed:
  • Alexander Elvitar

    () (Centro de Investigación y Docencia Económicas, (CIDE))

  • Andrei Gomberg

    () (Centro de Investigación Económica (CIE), Instituto Tecnológico Autónomo de México (ITAM))

  • César Martinelli

    () (Centro de Investigación Económica (CIE), Instituto Tecnológico Autónomo de México (ITAM))

  • Thomas R. Palfrey

    (California Institute of Technology)

Abstract

We consider a committee with common interests. Committee members do not know which of two alternatives is the best, but each member may acquire privately a costly signal before casting a vote under either majority or unanimity rule. In the lab, as predicted by Bayesian equilibrium, voters are more likely to acquire information under majority rule, and attempt to counter the bias built in favor of one alternative under unanimity rule. As opposed to Bayesian equilibrium predictions, however, some committee members vote for either alternative when uninformed. Moreover, uninformed voting is correlated with a lower disposition to acquire information. We show that an equilibrium model of subjective prior beliefs may account for this correlation, and provides a good fit for the observed patterns of behavior both in terms of rational ignorance and biases.

Suggested Citation

  • Alexander Elvitar & Andrei Gomberg & César Martinelli & Thomas R. Palfrey, 2014. "Ignorance and bias in collective decision:Theory and experiments," Working Papers 1401, Centro de Investigacion Economica, ITAM.
  • Handle: RePEc:cie:wpaper:1401
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    File URL: http://ftp.itam.mx/pub/academico/inves/martinelli/14-01.pdf
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    References listed on IDEAS

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    1. Jens Großer & Michael Seebauer, 2013. "The curse of uninformed voting: An experimental study," Working Paper Series in Economics 64, University of Cologne, Department of Economics.
    2. Camerer, Colin & Weigelt, Keith, 1988. "Experimental Tests of a Sequential Equilibrium Reputation Model," Econometrica, Econometric Society, vol. 56(1), pages 1-36, January.
    3. Martinelli, Cesar, 2006. "Would rational voters acquire costly information?," Journal of Economic Theory, Elsevier, vol. 129(1), pages 225-251, July.
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    5. César Martinelli, 2007. "Rational ignorance and voting behavior," International Journal of Game Theory, Springer;Game Theory Society, vol. 35(3), pages 315-335, February.
    6. McKelvey Richard D. & Palfrey Thomas R., 1995. "Quantal Response Equilibria for Normal Form Games," Games and Economic Behavior, Elsevier, vol. 10(1), pages 6-38, July.
    7. Gerardi, Dino & Yariv, Leeat, 2008. "Information acquisition in committees," Games and Economic Behavior, Elsevier, vol. 62(2), pages 436-459, March.
    8. Timothy Feddersen & Wolfgang Pesendorfer, 1997. "Voting Behavior and Information Aggregation in Elections with Private Information," Econometrica, Econometric Society, vol. 65(5), pages 1029-1058, September.
    9. Friedman, James W. & Mezzetti, Claudio, 2005. "Random belief equilibrium in normal form games," Games and Economic Behavior, Elsevier, vol. 51(2), pages 296-323, May.
    10. Feddersen, Timothy J & Pesendorfer, Wolfgang, 1996. "The Swing Voter's Curse," American Economic Review, American Economic Association, vol. 86(3), pages 408-424, June.
    11. Bhattacharya, Sourav & Duffy, John & Kim, Sun-Tak, 2014. "Compulsory versus voluntary voting: An experimental study," Games and Economic Behavior, Elsevier, vol. 84(C), pages 111-131.
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    13. Richard Mckelvey & Thomas Palfrey, 1998. "Quantal Response Equilibria for Extensive Form Games," Experimental Economics, Springer;Economic Science Association, vol. 1(1), pages 9-41, June.
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    Citations

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    Cited by:

    1. Mechtenberg, Lydia & Tyran, Jean-Robert, 2016. "Voter Motivation and the Quality of Democratic Choice," CEPR Discussion Papers 11622, C.E.P.R. Discussion Papers.
    2. Großer, Jens & Seebauer, Michael, 2016. "The curse of uninformed voting: An experimental study," Games and Economic Behavior, Elsevier, vol. 97(C), pages 205-226.
    3. repec:eee:pubeco:v:154:y:2017:i:c:p:34-48 is not listed on IDEAS
    4. Benchimol, Jonathan & Bounader, Lahcen, 2018. "Optimal Monetary Policy Under Bounded Rationality," Globalization and Monetary Policy Institute Working Paper 336, Federal Reserve Bank of Dallas.
    5. Sourav Bhattacharya & John Duffy & Sun-Tak Kim, 2015. "Voting with Endogenous Information Acquisition: Theory and Evidence," Working Papers 151602, University of California-Irvine, Department of Economics.
    6. King King Li & Toru Suzuki, 2016. "Jury voting without objective probability," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 46(2), pages 389-406, February.
    7. King Li & Toru Suzuki, 2016. "Jury voting without objective probability," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 46(2), pages 389-406, February.

    More about this item

    Keywords

    Condorcet jury theorem; rational ignorance; homemade priors;

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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