Wisdom of the Crowd? Information Aggregation in Representative Democracy

27 Pages Posted: 5 Jul 2017 Last revised: 31 Aug 2020

See all articles by Carlo Prato

Carlo Prato

Columbia University - Department of Political Science

Stephane Wolton

London School of Economics & Political Science (LSE) - Department of Government

Date Written: November 14, 2018

Abstract

The Condorcet Jury Theorem and subsequent literature establish that in a common-value environment with exogenous policy options, information aggregation is feasible: A large electorate of imperfectly informed voters almost always selects the correct policy option. In this paper, we show that these desirable properties of direct democracy do not necessarily carry over to representative democracy. Depending on candidates' motivations and information, representative democracy can select the correct policy with either higher or lower probability than direct democracy. In particular, information aggregation is not always feasible. Somewhat paradoxically, the possibility of information aggregation by voters encourages strategic conformism by candidates. Our findings are robust to various assumptions about candidate entry, voter information and behavior. They suggest that epistemic arguments in favor of democracy need to be qualified.

Keywords: political failure, representation, information aggregation, intermediation

JEL Classification: D70, D72, D82

Suggested Citation

Prato, Carlo and Wolton, Stephane, Wisdom of the Crowd? Information Aggregation in Representative Democracy (November 14, 2018). Available at SSRN: https://ssrn.com/abstract=2995012 or http://dx.doi.org/10.2139/ssrn.2995012

Carlo Prato (Contact Author)

Columbia University - Department of Political Science ( email )

7th Floor, International Affairs Bldg.
420 W. 118th Street
New York, NY 10027
United States

Stephane Wolton

London School of Economics & Political Science (LSE) - Department of Government ( email )

Houghton Street
London, WC2A 2AE
United Kingdom

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