Deliberation, Information Aggregation, and Collective Decision Making
Tinbergen Institute Discussion Paper No. TI 02-006/1
21 Pages Posted: 27 Dec 2004
Date Written: December 2003
We study a model of collective decision making with endogenous information collection. Agents collect information about the consequences of a project, communicate, and then vote on the project. We examine under what conditions communication may increase the probability that good decisions are made. Our most surprising result is that when there are no direct cost of communication and communication can only help to identify the truth, more communication may reduce the probability that a correct decision is made. The reason for this result is that communication may aggravate the free-rider problem associated with collecting information.
Keywords: Uncertainty, deliberation, learning, collective decision making
JEL Classification: D78, D83
Suggested Citation: Suggested Citation