Ignorance and bias in collective decision:Theory and experiments

Alexander Elvitar (), Andrei Gomberg, Cesar Martinelli and Thomas Palfrey
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Alexander Elvitar: Centro de Investigación y Docencia Económicas, (CIDE)

No 1401, Working Papers from Centro de Investigacion Economica, ITAM

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.

Keywords: Condorcet jury theorem; rational ignorance; homemade priors (search for similar items in EconPapers)
JEL-codes: D72 D83 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2014
New Economics Papers: this item is included in nep-cdm, nep-cta, nep-exp, nep-net and nep-pol
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

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Persistent link: https://EconPapers.repec.org/RePEc:cie:wpaper:1401

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