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Learning More by Doing Less

Author

Listed:
  • Ralph Boleslavsky

    (Department of Economics, University of Miami)

  • Christopher Cotton

    (Department of Economics, University of Miami)

Abstract

A principal must decide whether to implement each of two independent proposals (e.g., earmark requests, policy reforms, grant funding) of unknown quality. Each proposal is represented by an agent who advocates by producing evidence about quality. Although the principal prefers the most-informative evidence, agents strategically choose less-informative evidence to maximize the probability the principal implements their proposals. In this setting, we show how limited capacity (i.e., the ability of the principal to implement at most one of the two proposals) can motivate agents to produce more-informative evidence in an effort to convince the principal that their proposal is better than the alternative. We derive reasonable conditions under which the principal prefers limited capacity to unlimited capacity.

Suggested Citation

  • Ralph Boleslavsky & Christopher Cotton, 2011. "Learning More by Doing Less," Working Papers 2011-6, University of Miami, Department of Economics.
    • Handle: RePEc:mia:wpaper:2011-6
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    File URL: https://www.herbert.miami.edu/_assets/files/repec/wp2011-6.pdf
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    References listed on IDEAS

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    Cited by:

    1. Barbos, Andrei, 2013. "Project screening with tiered evaluation," Mathematical Social Sciences, Elsevier, vol. 66(3), pages 293-306.
    2. Andrei Barbos, 2014. "Imperfect evaluation in project screening," Journal of Economics, Springer, vol. 112(1), pages 31-46, May.
    3. Boleslavsky, Raphael & Lewis, Tracy R., 2016. "Evolving influence: Mitigating extreme conflicts of interest in advisory relationships," Games and Economic Behavior, Elsevier, vol. 98(C), pages 110-134.

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    More about this item

    Keywords

    Strategic search; Evidence production; Persuasion; Lobbying.;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality

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