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Information acquisition and transparency in committees

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  • Hans Gersbach
  • Volker Hahn

Abstract

We study a two-period model of committee decision-making where members differ in their levels of efficiency. They may acquire costly information that enhances their ability to make a correct decision. We focus on the impact of transparency. We show that the principal's initial utility is higher under transparency, because members exert more effort, which makes correct decisions more likely. The principal also benefits from transparency later, unless transparency leads to an alignment of the signal qualities of highly efficient and less efficient committee members. In general, committee members are harmed by transparency.
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  • Hans Gersbach & Volker Hahn, 2012. "Information acquisition and transparency in committees," International Journal of Game Theory, Springer;Game Theory Society, vol. 41(2), pages 427-453, May.
    • Handle: RePEc:spr:jogath:v:41:y:2012:i:2:p:427-453
    DOI: 10.1007/s00182-011-0295-5
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    Cited by:

    1. Sebastian Fehrler & Moritz Janas, 2021. "Delegation to a Group," Management Science, INFORMS, vol. 67(6), pages 3714-3743, June.
    2. Kedan, Danielle & Stuart, Rebecca, 2014. "Central Bank Communications: A Comparative Study," Quarterly Bulletin Articles, Central Bank of Ireland, pages 89-104, April.
    3. Balmaceda, Felipe, 2021. "Private vs. public communication: Difference of opinion and reputational concerns," Journal of Economic Theory, Elsevier, vol. 196(C).
    4. Swank, Otto H. & Visser, Bauke, 2023. "Committees as active audiences: Reputation concerns and information acquisition," Journal of Public Economics, Elsevier, vol. 221(C).
    5. Andrea Mattozzi & Marcos Y. Nakaguma, 2016. "Public versus Secret Voting in Committees," Working Papers, Department of Economics 2016_29, University of São Paulo (FEA-USP).
    6. Belke, Ansgar, 2017. "Central bank communication: Managing expectations through the monetary dialogue," Ruhr Economic Papers 692, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    7. Name-Correa, Alvaro J. & Yildirim, Huseyin, 2019. "Social pressure, transparency, and voting in committees," Journal of Economic Theory, Elsevier, vol. 184(C).
    8. Svensson, Lars E.O., 2009. "Transparency under Flexible Inflation Targeting: Experiences and Challenges," CEPR Discussion Papers 7213, C.E.P.R. Discussion Papers.
    9. Stephen Hansen & Michael McMahon & Andrea Prat, 2018. "Transparency and Deliberation Within the FOMC: A Computational Linguistics Approach," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 133(2), pages 801-870.
    10. Gersbach, Hans & Mamageishvili, Akaki & Tejada, Oriol, 2020. "Appointed Learning for the Common Good: Optimal Committee Size and Efficient Rewards," CEPR Discussion Papers 15311, C.E.P.R. Discussion Papers.
    11. Mikael Apel & Marianna Blix Grimaldi & Isaiah Hull, 2022. "How Much Information Do Monetary Policy Committees Disclose? Evidence from the FOMC's Minutes and Transcripts," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 54(5), pages 1459-1490, August.
    12. Otto H. Swank & Bauke Visser, 2007. "Is Transparency to no avail? Committee Decision-making, Pre-meetings, and Credible Deals," Tinbergen Institute Discussion Papers 07-055/1, Tinbergen Institute.
    13. Carsten Hefeker & Blandine Zimmer, 2015. "Optimal Conservatism and Collective Monetary Policymaking under Uncertainty," Open Economies Review, Springer, vol. 26(2), pages 259-278, April.
    14. Gersbach, Hans & Mamageishvili, Akaki & Tejada, Oriol, 2022. "Appointed learning for the common good: Optimal committee size and monetary transfers," Games and Economic Behavior, Elsevier, vol. 136(C), pages 153-176.
    15. Chaim Fershtman & Uzi Segal, 2020. "Social Influence in Legal Deliberations," Boston College Working Papers in Economics 999, Boston College Department of Economics, revised 12 Sep 2021.
    16. Fang, Ximeng & Ho, Chui Yee, 2024. "The effect of transparency on subjective evaluations: Evidence from competitive figure skating," VfS Annual Conference 2024 (Berlin): Upcoming Labor Market Challenges 302427, Verein für Socialpolitik / German Economic Association.
    17. Fehrler, Sebastian & Hahn, Volker, 2020. "Committee Decision-Making under the Threat of Leaks," IZA Discussion Papers 13746, Institute of Labor Economics (IZA).
    18. Chaim Fershtman & Uzi Segal, 2024. "Social influence in committee deliberation," Theory and Decision, Springer, vol. 96(2), pages 185-207, March.
    19. Volker Hahn, 2012. "On the Optimal Size of Committees of Experts," Working Paper Series of the Department of Economics, University of Konstanz 2012-24, Department of Economics, University of Konstanz.
    20. Ginzburg, Boris & Guerra, José-Alberto, 2019. "When collective ignorance is bliss: Theory and experiment on voting for learning," Journal of Public Economics, Elsevier, vol. 169(C), pages 52-64.
    21. Kedan, Danielle & Stuart, Rebecca, 2014. "Central Bank Minutes," Economic Letters 12/EL/14, Central Bank of Ireland.
    22. Daniel Gibbs, 2023. "Individual accountability, collective decision-making," Constitutional Political Economy, Springer, vol. 34(4), pages 524-552, December.
    23. Volker Hahn, 2017. "On the drawbacks of large committees," International Journal of Game Theory, Springer;Game Theory Society, vol. 46(2), pages 563-582, May.
    24. Jan Filacek & Lucie Kokesova Matejkova, 2022. "Disclosing Dissent in Monetary Policy Committees," Research and Policy Notes 2022/02, Czech National Bank.

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    More about this item

    Keywords

    Committees; Career concerns; Experts; Transparency; Information acquisition; D71;
    All these keywords.

    JEL classification:

    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General

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