Information aggregation, costly voting and common values
Ghosal, Sayantan and Lockwood, Ben (2003) Information aggregation, costly voting and common values. Working Paper. Coventry: University of Warwick, Department of Economics. Warwick economic research papers (No.670).
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In a model of majority voting with common values and costly but voluntary participation, we show that in the vicinity of equilibrium, it is always Pareto-improving for more agents, on the average, to vote. This demonstrates that the negative voting externality identified by Borgers(2001) in the context of private values is always dominated by a positive informational externality. In addition, we show that multiple Pareto-ranked voting equilibria may exist and moreover, majority voting with compulsory participation can Pareto dominate majority voting with voluntary participation. Finally, we show that the inefficiency result is robust to limited preference heterogeneity.
|Item Type:||Working or Discussion Paper (Working Paper)|
|Subjects:||H Social Sciences > HB Economic Theory|
|Divisions:||Faculty of Social Sciences > Economics|
|Library of Congress Subject Headings (LCSH):||Voting research, Equilibrium (Economics), Externalities (Economics), Voting, Compulsory, Distribution (Economic theory)|
|Series Name:||Warwick economic research papers|
|Publisher:||University of Warwick, Department of Economics|
|Place of Publication:||Coventry|
|Official Date:||January 2003|
|Number of Pages:||21|
|Status:||Not Peer Reviewed|
|Access rights to Published version:||Restricted or Subscription Access|
|Version or Related Resource:||Later published in a revised form as: Ghosal, S. and Lockwood, B. (2009). Costly voting when both information and preferences differ: is turnout too high or too low? Social Choice and Welfare, 33(1), pp. 25-50. http://wrap.warwick.ac.uk/28084/|
 Austen-Smith, D. and J.S. Banks (1996), “ Information Aggregation, Rationality and the Condorcet jury theorem”, American Political Science Review, 90, pp.34-45.
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