The Wisdom of the Crowd: Uninformed Voting and the Efficiency of Democracy

Ralph-Christopher Bayer (), Marco Faravelli () and Carlos Pimienta ()
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Ralph-Christopher Bayer: School of Economics and Public Policy, The University of Adelaide.
Marco Faravelli: University of Queensland
Carlos Pimienta: UNSW School of Economics

No 2023-08, Discussion Papers from School of Economics, The University of New South Wales

Abstract: We show in a novel voting model with costly information acquisition that in equilibrium nobody votes without acquiring information and that the probability of the better alternative winning converges to one as the size of the electorate approaches infinity. In a large-scale internet experiment during the US Presidential Election, we find alarming rates of uninformed voting (>42 percent). The problem is exacerbated in treatments that allow for expressive voting motives and overconfidence (rates up to 56 percent). Increasing the electorate size substantially raises efficiency, as long as uninformed voting is not too biased towards one alternative.

Keywords: Costly information acquisition; Condorcet Jury Theorem; Uninformed voting; Wisdom of the crowd (search for similar items in EconPapers)
JEL-codes: C72 C90 D72 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2023-04
New Economics Papers: this item is included in nep-cdm and nep-pol
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