Conformity Preferences and Information Gathering Effort in Collective Decision Making
Ding Huihui ()
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Ding Huihui: GREThA, Université de Bordeaux, avenue Léon Duguit, 33608 Pessac cedex, France
The B.E. Journal of Theoretical Economics, 2018, vol. 18, issue 1, 18
Our study concerns a collective decision-making model for the collection of information from two voters. Both voters, who tend to make the same voting choices because of their conformity preferences, collect information about the consequences of a project and then vote on the project. We focus on an informative equilibrium in which voters vote informatively using pure strategies. This is a symmetric Nash equilibrium. Our result is interesting as it shows that nonconformist voters exert less effort from a social perspective because of a positive externality that results in the free-rider problem, while conformity preferences can help to improve the sum of the voters’ expected payoffs from the social perspective. This is because conformity preferences may alleviate the free-rider problem associated with coordination (making the same vote). Specifically, conformity preferences give special importance to the correlation between voters’ signals, even if this correlation is unrelated to the accuracy of the signals. Furthermore, we present the exact conformity preference level which helps voters to exert an optimal effort level that maximizes the sum of the voters’ expected payoffs compared to the nonconformist case. In addition, we graphically illustrate comparative statics on effort levels in informative equilibria.
Keywords: normative conformity preferences; information gathering effort; collective decision making (search for similar items in EconPapers)
JEL-codes: D72 D82 (search for similar items in EconPapers)
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