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Over-caution of large committees of experts

Author

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  • Midjord, Rune
  • Rodríguez Barraquer, Tomás
  • Valasek, Justin

Abstract

We provide an explanation for why committees may behave over-cautiously. A committee of experts makes a decision on a proposed innovation on behalf of 'society'. Each expert's signal about the innovation's quality is generated by the available evidence and the best practices of the experts' common discipline, which is only indirectly related to the true state of the world. In addition to a payoff linked to the adequateness of the committee's decision, each expert receives a disesteem payoff if he/she voted in favor of an ill-fated innovation. No matter how small the disesteem payoffs are, information aggregation fails in large committees: under any majority rule, the committee rejects the innovation almost surely.

Suggested Citation

  • Midjord, Rune & Rodríguez Barraquer, Tomás & Valasek, Justin, 2013. "Over-caution of large committees of experts," Discussion Papers, Research Unit: Economics of Change SP II 2013-313, Social Science Research Center Berlin (WZB).
  • Handle: RePEc:zbw:wzbeoc:spii2013313
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    References listed on IDEAS

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    1. 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.
    2. Gerling, Kerstin & Gruner, Hans Peter & Kiel, Alexandra & Schulte, Elisabeth, 2005. "Information acquisition and decision making in committees: A survey," European Journal of Political Economy, Elsevier, vol. 21(3), pages 563-597, September.
    3. Tore Ellingsen & Magnus Johannesson, 2008. "Pride and Prejudice: The Human Side of Incentive Theory," American Economic Review, American Economic Association, vol. 98(3), pages 990-1008, June.
    4. repec:cup:apsrev:v:79:y:1985:i:01:p:62-78_22 is not listed on IDEAS
    5. John Morgan & Felix Várdy, 2012. "Mixed Motives and the Optimal Size of Voting Bodies," Journal of Political Economy, University of Chicago Press, vol. 120(5), pages 986-1026.
    6. Bezalel Peleg & Shmuel Zamir, 2012. "Extending the Condorcet Jury Theorem to a general dependent jury," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 39(1), pages 91-125, June.
    7. 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.
    8. Brennan, Geoffrey & Pettit, Philip, 2004. "The Economy of Esteem: An Essay on Civil and Political Society," OUP Catalogue, Oxford University Press, number 9780199246489.
    9. Li Hao & Wing Suen, 2009. "Viewpoint: Decision-making in committees," Canadian Journal of Economics, Canadian Economics Association, vol. 42(2), pages 359-392, May.
    10. Callander, Steven, 2008. "Majority rule when voters like to win," Games and Economic Behavior, Elsevier, vol. 64(2), pages 393-420, November.
    11. repec:cup:apsrev:v:92:y:1998:i:01:p:23-35_20 is not listed on IDEAS
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    Cited by:

    1. Henry, Emeric & Louis-Sidois, Charles, 2015. "Voting and contributing when the group is watching," CEPR Discussion Papers 10912, C.E.P.R. Discussion Papers.
    2. Emeric Henry & Charles Louis-Sidois, 2015. "Voting and Contributing While the Group is Watching," Sciences Po publications info:hdl:2441/4g5hemr5o18, Sciences Po.
    3. repec:eee:gamebe:v:104:y:2017:i:c:p:430-443 is not listed on IDEAS

    More about this item

    Keywords

    Committees; Information aggregation; Disesteem payoffs;

    JEL classification:

    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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