Deliberation, Information Aggregation, and Collective Decision Making

Tinbergen Institute Discussion Paper No. TI 02-006/1

21 Pages Posted: 27 Dec 2004

See all articles by Otto H. Swank

Otto H. Swank

Erasmus University Rotterdam - Department of Economics; Tinbergen Institute Rotterdam (TIR)

Phongthorn Wrasai

Erasmus University Rotterdam (EUR) - Department of Economics

Date Written: December 2003

Abstract

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

Swank, Otto H. and Wrasai, Phongthorn, Deliberation, Information Aggregation, and Collective Decision Making (December 2003). Tinbergen Institute Discussion Paper No. TI 02-006/1, Available at SSRN: https://ssrn.com/abstract=635285 or http://dx.doi.org/10.2139/ssrn.635285

Otto H. Swank

Erasmus University Rotterdam - Department of Economics ( email )

P.O. Box 1738
3000 DR Rotterdam
Netherlands

Tinbergen Institute Rotterdam (TIR)

P.O. Box 1738
3000 DR Rotterdam
Netherlands
+31 10 4081448 (Phone)
+31 10 2120551 (Fax)

Phongthorn Wrasai (Contact Author)

Erasmus University Rotterdam (EUR) - Department of Economics ( email )

P.O. Box 1738
3000 DR Rotterdam
Netherlands
+31 10 408 8926 (Phone)

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