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Deliberation, Information Aggregation and Collective Decision Making

Author

Listed:
  • Otto H. Swank

    (Erasmus University Rotterdam and Tinbergen Institute)

  • Phongthorn Wrasai

    (Erasmus University Rotterdam and Tinbergen Institute)

Abstract

We study a model of collective decision making with endogenous information collection.Agents collect information about the consequences of a project, communicate, and then vote onthe project. We examine under what conditions communication may increase the probability thatgood decisions are made. Our most surprising result is that when there are no direct cost ofcommunication and communication can only help to identify the truth, more communication may reducethe probability that a correct decision is made. The reason for this result is that communicationmay aggravate the free-rider problem associated with collecting information.

Suggested Citation

  • Otto H. Swank & Phongthorn Wrasai, 2002. "Deliberation, Information Aggregation and Collective Decision Making," Tinbergen Institute Discussion Papers 02-006/1, Tinbergen Institute, revised 03 Dec 2002.
    • Handle: RePEc:tin:wpaper:20020006
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    References listed on IDEAS

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    6. Abhijit Banerjee & Rohini Somanathan, 2001. "A Simple Model of Voice," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(1), pages 189-227.
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    Cited by:

    1. Berk, Jan Marc & Bierut, Beata K., 2011. "Communication in a monetary policy committee," European Journal of Political Economy, Elsevier, vol. 27(4), pages 791-801.
    2. Ding Huihui, 2018. "Conformity Preferences and Information Gathering Effort in Collective Decision Making," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 18(1), pages 1-18, January.
    3. Jan Marc Berk & Beata K. Bierut, 2005. "Communication in Monetary Policy Committees," DNB Working Papers 059, Netherlands Central Bank, Research Department.
    4. Jan Marc Berk & Beata K. Bierut, 2004. "The Effects of Learning in Interactive Monetary Policy Committees," Tinbergen Institute Discussion Papers 04-029/2, Tinbergen Institute.

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    More about this item

    Keywords

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    JEL classification:

    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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