Expert advising under checks and balances

This paper attempts to compare the efficiencies of different political institutions (with or without checks and balances) in extracting external “cheap talk” information. We find that a political institution with checks and balances can extract more credible information (measured by the number of signals) from an external partisan expert because no policymaker can unilaterally exploit revealed expert information to her own best advantage. However, there is a tradeoff between signal quantity and distribution under checks and balances, as more signals tend to be distributed more unevenly due to the existence of an “inertia region” where credible communication is more difficult. Institutions using checks and balances are more efficient when conflict of interest between policymakers is relatively small, in which case the signal distribution is less uneven. Copyright Springer-Verlag Berlin Heidelberg 2014