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Delegation or Voting

Author

Listed:
  • Otto H. Swank

    (Erasmus University Rotterdam)

  • Bauke Visser

    (Erasmus University Rotterdam)

Abstract

Collective decision procedures should balance the incentives they provide toacquire information and their capacity to aggregate private information. In a decisionproblem in which a project can be accepted or rejected once information about its qualityhas been acquired or not, we compare the performance of a delegation structure with that oftwo voting procedures. Delegation makes one's acceptance decision pivotal by definition.The decisiveness of one's vote in a voting procedure depends on the other agent's vote.This in turn determines the decision to acquire information. In the debate about a rationalchoice foundation of Condorcet's Jury Theorem, the distribution of information was leftexogenous. Mixed (acceptance) strategies were required to validate the Theorem.Endogenizing information acquisition as we do reveals mixed (acceptance) strategies to bedetrimental for welfare as they lead to indifference between buying and not buyinginformation.

Suggested Citation

  • Otto H. Swank & Bauke Visser, 2002. "Delegation or Voting," Tinbergen Institute Discussion Papers 02-005/1, Tinbergen Institute.
    • Handle: RePEc:tin:wpaper:20020005
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    References listed on IDEAS

    as
    1. Gilligan, Thomas W & Krehbiel, Keith, 1997. "Specialization Decisions within Committee," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 13(2), pages 366-386, October.
    2. Cukierman, A. & Spiegel, Y., 1998. "When do Representative and Direct Democracies Lead to Similar Policy Choices?," Papers 21-98, Tel Aviv.
    3. Piketty, Thomas, 1999. "The information-aggregation approach to political institutions," European Economic Review, Elsevier, vol. 43(4-6), pages 791-800, April.
    4. Ben-Yashar, Ruth C & Nitzan, Shmuel I, 1997. "The Optimal Decision Rule for Fixed-Size Committees in Dichotomous Choice Situations: The General Result," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 38(1), pages 175-186, February.
    5. Wit, Jorgen, 1998. "Rational Choice and the Condorcet Jury Theorem," Games and Economic Behavior, Elsevier, vol. 22(2), pages 364-376, February.
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    Cited by:

    1. Morasch, Karl, 2003. "Deciding about (de-)centralization of industrial policy: Delegation by a central authority vs. bargaining of regional governments," Working Papers in Economics 2003,3, Bundeswehr University Munich, Economic Research Group.

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    More about this item

    Keywords

    Voting; Jury theorem; Information; Effort;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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