Group Cascades in Strategic Voting
24 Pages Posted:
Date Written: January 30, 2025
Abstract
We bridge the theories of information cascades (Bikhchandani et al., 1992) and strategic voting (Feddersen and Pesendorfer, 1998) by studying a sequence of voting groups whose members have common values and independent private information. Each group strategically votes on a decision after observing all earlier groups' decisions. We show that the asymptotic public belief distributions and expected utilities are sensitive to the voting rules. When all groups use the same voting rule, the rule that maximises asymptotic payoff can differ from the one that maximises the first group's information revelation. This difference occurs only when the former rule induces limit beliefs strictly above the threshold that triggers cascades, which is always true for the unanimous rule but not the relatively symmetric rules. We present examples where, under a weak prior belief, the simple majority rule is best for the first group but asymptotically dominated by the unanimous rule.
Keywords: Information cascades, observational learning, strategic voting, common value voting
Suggested Citation: Suggested Citation