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Ekonomická analýza referenda
[Economic Analysis of a Referendum]

Author

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  • Petr Špecián

Abstract

The paper synthesizes the current literature regarding information aggregation, voter compe-tence, voting paradox and behavioral economics in order to answer the question whether the phenomenon of "wisdom of the crowds" can be reasonably relied upon during a referendum. Review of the 'wisdom of the crowds' research reveals two key assumptions: voter competence and voter independence. Although direct testing of the actual fulfillment of these assumptions in a real-world setting is not possible, both empirical literature on voting behavior and rational choice theory provide ample ground for skepticism in this regard. Low level of knowledge together with unmitigated influence of systematic biases is expected to dominate the actual voting behavior. Affect heuristic is used as an example to illustrate this point. The paper concludes that referendum does not seem to be a reliable way to revealing preferences regarding various social issues.

Suggested Citation

  • Petr Špecián, 2017. "Ekonomická analýza referenda [Economic Analysis of a Referendum]," Politická ekonomie, Prague University of Economics and Business, vol. 2017(4), pages 460-475.
    • Handle: RePEc:prg:jnlpol:v:2017:y:2017:i:4:id:1155:p:460-475
    DOI: 10.18267/j.polek.1155
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    References listed on IDEAS

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    More about this item

    Keywords

    wisdom of the crowds; Condorcet jury theorem; miracle of aggregation; Hong-Page theorem; paradox of voting; affect heuristic; referendum;
    All these keywords.

    JEL classification:

    • D60 - Microeconomics - - Welfare Economics - - - General
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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