Information manipulation and majority rule

Bo Wang and Suli Zheng

Economics Letters, 2024, vol. 242, issue C

Abstract: This paper studies endogenous institution in the presence of information manipulation. We show majority rule discourages information manipulation, reducing Type II errors in collective decision-making. In equilibrium, the optimal majority rule strategically balances the reduction in Type II errors associated with discouraging information manipulation with the potential increase in Type I errors. When it comes to green environmental issues, member countries often adopt a majority rule voting system. This is because these issues typically involve high inherent risks that affect all countries on a global scale, and low heterogeneity among members in terms of the desire to address these challenges.

Keywords: Information manipulation; Majority rule; Decision-making (search for similar items in EconPapers)
JEL-codes: D72 D80 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:242:y:2024:i:c:s0165176524003082

DOI: 10.1016/j.econlet.2024.111824

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