Abstract
Identical agents gather costly information, and then aggregate it through voting. Because information is a public good, information is underprovided relative to the social optimum. A "good" voting rule must give incentives to acquire information, as well as aggregate information efficiently. A voting rule that requires a large plurality (in the extreme, unanimity) to upset the status quo can be optimal only if the information available to each agent is sufficiently accurate. This result is independent of the preferences of voters and of the cost of information.
| Original language | English (US) |
|---|---|
| Pages (from-to) | 165-191 |
| Number of pages | 27 |
| Journal | Review of Economic Studies |
| Volume | 71 |
| Issue number | 1 |
| DOIs | |
| State | Published - Jan 2004 |
Funding
As n becomes large the term in curly brackets converges to the negative number −2 + (1/p), while the term outside brackets goes to infinity. This large negative term will dominate the derivative of the marginal incentive to stay informed. Thus, for large n the marginal incentive to stay informed is decreasing in p, as was to be shown. ‖ Acknowledgements. I am grateful to Alessando Lizzeri for encouragement. Mark Armstrong and two anonymous referees have made many helpful observations. Financial support from the National Science Foundation under grant SBR 9905564 is gratefully acknowledged.
ASJC Scopus subject areas
- Economics and Econometrics