Information Search and Revelation in Groups
We analyze costly information acquisition and information revelation in groups that evaluate different decision options in a dynamic setting. Even when team members have perfectly aligned interests the group may inefficiently delay decisions due to either insufficient information acquisition effort or due to the unwillingness of informed team members to reveal their information in an attempt to incentivize their co-workers to continue searching for information. Although deadlines can reduce costly delay, we show that, surprisingly, expected decision time is non-monotonic in the length of the deadline. The optimal deadline is unique and finite and incentivizes team members to intensely search for information while at same time minimizing any unnecessary delay in decision-making. As long as the deadline is set optimally, welfare is higher when information is only privately observable to the agent who obtained rather than to the entire group. We further explore how contracts, monitoring and third-party information intermediaries influence the actions of the group members.
|Date of creation:||2011|
|Contact details of provider:|| Postal: Society for Economic Dynamics Marina Azzimonti Department of Economics Stonybrook University 10 Nicolls Road Stonybrook NY 11790 USA|
Web page: http://www.EconomicDynamics.org/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Gilat Levy, 2007.
"Decision Making in Committees: Transparency, Reputation, and Voting Rules,"
American Economic Review,
American Economic Association, vol. 97(1), pages 150-168, March.
- Gilat Levy, 2005. "Decision making in committees: transparency, reputation and voting rules," LSE Research Online Documents on Economics 543, London School of Economics and Political Science, LSE Library.
- Gilat Levy, 2007. "Decision making in committees: transparency, reputation, and voting rules," LSE Research Online Documents on Economics 3697, London School of Economics and Political Science, LSE Library.
- Ettore Damiano & Hao Li & Wing Suen, 2008. "Delay in Strategic Information Aggregation," Working Papers tecipa-311, University of Toronto, Department of Economics.
- Alessandro Bonatti & Johannes Horner, 2011. "Collaborating," American Economic Review, American Economic Association, vol. 101(2), pages 632-663, April.
- Alessandro Bonatti & Johannes Horner, 2009. "Collaborating," Cowles Foundation Discussion Papers 1695, Cowles Foundation for Research in Economics, Yale University, revised Nov 2009.
- Johannes Horner & Alessandro Bonatti, 2009. "Collaborating," 2009 Meeting Papers 1019, Society for Economic Dynamics.
- Nicola Persico, 2004. "Committee Design with Endogenous Information," Review of Economic Studies, Oxford University Press, vol. 71(1), pages 165-191.
- Hongbin Cai, 2009. "Costly participation and heterogeneous preferences in informational committees," RAND Journal of Economics, RAND Corporation, vol. 40(1), pages 173-189.
- Ottaviani, Marco & Sorensen, Peter, 2001. "Information aggregation in debate: who should speak first?," Journal of Public Economics, Elsevier, vol. 81(3), pages 393-421, September.
- Siew Hong Teoh, 1997. "Information Disclosure and Voluntary Contributions to Public Goods," RAND Journal of Economics, The RAND Corporation, vol. 28(3), pages 385-406, Autumn.
- Jordi Blanes i Vidal & Marc Möller, 2013. "Decision–Making and Implementation in Teams," CEP Discussion Papers dp1208, Centre for Economic Performance, LSE. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:red:sed011:997. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christian Zimmermann)
If references are entirely missing, you can add them using this form.