Over-Caution of Large Committees of Experts
Tomás Rodríguez and
Justin Mattias Valasek
No 4810, CESifo Working Paper Series from CESifo
In this paper, we consider a committee of experts that decides whether to approve or reject a proposed innovation on behalf of society. 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. An example is FDA committees, where committee members can be exposed to a disesteem payoff (negative) if they vote to pass a drug that proves to be fatal for some users. Under the standard voting model, we show that information is aggregated in large committees provided disesteem payoffs are not overly large. However, we go on to document an empirically-relevant discontinuity in the standard model: if an arbitrarily large number of signals does not perfectly reflect the state of the world then, no matter how small the disesteem payoffs are, information aggregation fails in large committees and the committee rejects the innovation almost surely, providing an explanation for over-caution in committees.
Keywords: committees; information aggregation; disesteem payoffs (search for similar items in EconPapers)
JEL-codes: D71 D72 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed
Downloads: (external link)
Working Paper: Over-Caution of Large Committees of Experts (2013)
Working Paper: Over-caution of large committees of experts (2013)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_4810
Access Statistics for this paper
More papers in CESifo Working Paper Series from CESifo Contact information at EDIRC.
Bibliographic data for series maintained by Klaus Wohlrabe ().