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The Wisdom of the Crowd: Uninformed Voting and the Efficiency of Democracy

Author

Listed:
  • Ralph-Christopher Bayer

    (School of Economics and Public Policy, The University of Adelaide.)

  • Marco Faravelli

    (University of Queensland)

  • Carlos Pimienta

    (UNSW School of Economics)

Abstract

We show in a novel voting model with costly information acquisition that in equilibrium nobody votes without acquiring information and that the probability of the better alternative winning converges to one as the size of the electorate approaches infinity. In a large-scale internet experiment during the US Presidential Election, we find alarming rates of uninformed voting (>42 percent). The problem is exacerbated in treatments that allow for expressive voting motives and overconfidence (rates up to 56 percent). Increasing the electorate size substantially raises efficiency, as long as uninformed voting is not too biased towards one alternative.

Suggested Citation

  • Ralph-Christopher Bayer & Marco Faravelli & Carlos Pimienta, 2023. "The Wisdom of the Crowd: Uninformed Voting and the Efficiency of Democracy," Discussion Papers 2023-08, School of Economics, The University of New South Wales.
    • Handle: RePEc:swe:wpaper:2023-08
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    File URL: http://research.economics.unsw.edu.au/RePEc/papers/2023-08.pdf
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Costly information acquisition; Condorcet Jury Theorem; Uninformed voting; Wisdom of the crowd;
    All these keywords.

    JEL classification:

    • C90 - Mathematical and Quantitative Methods - - Design of Experiments - - - General
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

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