Cookies?
Library Header Image
LSE Research Online LSE Library Services

Optimal voting schemes with costly information acquisition

Gershkov, Alex and Szentes, Balázs (2009) Optimal voting schemes with costly information acquisition. Journal of Economic Theory, 144 (1). pp. 36-68. ISSN 1095-7235

Full text not available from this repository.
Identification Number: 10.1016/j.jet.2008.02.004

Abstract

A group of individuals with identical preferences must make a decision under uncertainty about which decision is best. Before the decision is made, each agent can privately acquire a costly and imperfect signal. We discuss how to design a mechanism for eliciting and aggregating the collected information so as to maximize ex-ante social welfare. We first show that, of all mechanisms, a sequential one is optimal and works as follows. At random, one agent at a time is selected to acquire information and report the resulting signal. Agents are informed of neither their position in the sequence nor of other reports. Acquiring information when called upon and reporting truthfully is an equilibrium. We next characterize the ex-ante optimal scheme among all ex-post efficient mechanisms. In this mechanism, a decision is made when the precision of the posterior exceeds a cut-off that decreases with each additional report. The restriction to ex-post efficiency is shown to be without loss when the available signals are sufficiently imprecise. On the other hand, ex-post efficient mechanisms are shown to be suboptimal when the cost of information acquisition is sufficiently small.

Item Type: Article
Official URL: http://www.journals.elsevier.com/journal-of-econom...
Additional Information: © 2009 Elsevier
Subjects: H Social Sciences > HB Economic Theory
Sets: Departments > Economics
Collections > Economists Online
Date Deposited: 24 Feb 2012 10:30
Last Modified: 02 Jun 2014 09:15
URI: http://eprints.lse.ac.uk/id/eprint/42026

Actions (login required)

View Item View Item