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Continuous decisions by a committee: Median versus average mechanisms

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  • Rosar, Frank

Abstract

A group of strategic agents with diverse private information and interdependent preferences has to take a continuous collective decision. I study the design of the decision-making procedure from the viewpoint of a utilitarian social planner. For uniformly distributed information, the implementation of the average report as decision dominates the implementation of the median report when the set of admissible reports is optimally designed. This is true for any number of agents and for any degree of interdependence. The result extends to a general class of distributions when the number of agents is large.

Suggested Citation

  • Rosar, Frank, 2015. "Continuous decisions by a committee: Median versus average mechanisms," Journal of Economic Theory, Elsevier, vol. 159(PA), pages 15-65.
    • Handle: RePEc:eee:jetheo:v:159:y:2015:i:pa:p:15-65
    DOI: 10.1016/j.jet.2015.05.010
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    Cited by:

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    2. Gershkov, Alex & Kleiner, Andreas & Moldovanu, Benny & Shi, Xianwen, 2023. "Voting with interdependent values: The Condorcet winner," Games and Economic Behavior, Elsevier, vol. 142(C), pages 193-208.
    3. Gersbach, Hans & Tejada, Oriol, 2020. "Semi-flexible Majority Rules for Public Good Provision," CEPR Discussion Papers 15099, C.E.P.R. Discussion Papers.
    4. Louis, Philippos & Núñez, Matías & Xefteris, Dimitrios, 2023. "Trimming extreme reports in preference aggregation," Games and Economic Behavior, Elsevier, vol. 137(C), pages 116-151.
    5. Philippos Louis & Matías Núñez & Dimitrios Xefteris, 2019. "Trimming Extreme Opinions in Preference Aggregation," University of Cyprus Working Papers in Economics 12-2019, University of Cyprus Department of Economics.
    6. Puppe, Clemens & Rollmann, Jana, 2021. "Mean versus median voting in multi-dimensional budget allocation problems. A laboratory experiment," Games and Economic Behavior, Elsevier, vol. 130(C), pages 309-330.
    7. Alex Gershkov & Andreas Kleiner & Benny Moldovanu & Xianwen Shi, 2019. "The Art of Compromising: Voting with Interdependent Values and the Flag of the Weimar Republic," Working Papers tecipa-645, University of Toronto, Department of Economics.
    8. Name Correa, Alvaro J. & Yildirim, Huseyin, 2021. "Biased experts, majority rule, and the optimal composition of committee," Games and Economic Behavior, Elsevier, vol. 127(C), pages 1-27.

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    More about this item

    Keywords

    Collective decision; Median mechanism; Average mechanism; Optimal delegation; Interdependent preferences; No monetary transfers;
    All these keywords.

    JEL classification:

    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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