Individual and Collective Information Acquisition: An Experimental Study

46 Pages Posted: 10 Dec 2021

See all articles by Pellumb Reshidi

Pellumb Reshidi

Princeton University

Alessandro Lizzeri

Princeton University - Department of Economics

Leeat Yariv

Princeton University; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)

Jimmy Chan

The Chinese University of Hong Kong (CUHK) - Department of Economics

Wing Suen

The University of Hong Kong - University of Hong Kong

Multiple version iconThere are 2 versions of this paper

Date Written: 2021

Abstract

Many committees—juries, political task forces, etc.—spend time gathering costly information before reaching a decision. We report results from lab experiments focused on such information-collection processes. We consider decisions governed by individuals and groups and compare how voting rules affect outcomes. We also contrast static information collection, as in classical hypothesis testing, with dynamic collection, as in sequential hypothesis testing. Several insights emerge. Static information collection is excessive, and sequential information collection is non-stationary, producing declining decision accuracies over time. Furthermore, groups using majority rule yield especially hasty and inaccurate decisions. Nonetheless, sequential information collection is welfare enhancing relative to static collection, particularly when unanimous rules are used.

Keywords: information acquisition, collective choice, experiments

JEL Classification: C910, C920, D720, D830, D870

Suggested Citation

Reshidi, Pellumb and Lizzeri, Alessandro and Yariv, Leeat and Chan, Jimmy and Suen, Wing, Individual and Collective Information Acquisition: An Experimental Study (2021). CESifo Working Paper No. 9468, Available at SSRN: https://ssrn.com/abstract=3982031 or http://dx.doi.org/10.2139/ssrn.3982031

Pellumb Reshidi (Contact Author)

Princeton University ( email )

22 Chambers Street
Princeton, NJ 08544-0708
United States

Alessandro Lizzeri

Princeton University - Department of Economics ( email )

Princeton, NJ 08544-1021
United States
08544 (Fax)

Leeat Yariv

Princeton University ( email )

Princeton, NJ 08544-1021
United States

Centre for Economic Policy Research (CEPR)

London
United Kingdom

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Jimmy Chan

The Chinese University of Hong Kong (CUHK) - Department of Economics ( email )

Shatin, N.T.
Hong Kong

Wing Suen

The University of Hong Kong - University of Hong Kong ( email )

Pokfulam Road
Hong Kong, Hong Kong
China

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
57
Abstract Views
360
rank
504,302
PlumX Metrics