Title

Individual and Collective Information Acquisition: An Experimental Study

Author(s)

Pëllumb Reshidi Pëllumb Reshidi (Duke University)

Alessandro Lizzeri Alessandro Lizzeri (Princeton University)

Leeat Yariv Leeat Yariv (Princeton University)

Jimmy Chan Jimmy Chan (National Taiwan University and The Chinese University of Hong Kong)

Wing Suen Wing Suen (University of Hong Kong)

Abstract

Many committees—juries, political task forces, etc.—spend time gathering costly information before reaching a decision. We report results from lab experiments focused on such information collection processes. We consider decisions governed by individuals and groups and compare how voting rules affect outcomes. We also contrast static information collection, as in classical hypothesis testing, with dynamic collection, as in sequential hypothesis testing. Several insights emerge. Static information collection is excessive, and sequential information collection is non-stationary, producing declining decision accuracies over time. Furthermore, groups using majority rule yield especially hasty and inaccurate decisions. Nonetheless, sequential information collection is welfare enhancing relative to static collection, particularly when unanimous rules are used.

Creation Date

2024-05

Section URL ID

Paper Number

312

URL

https://gceps.princeton.edu/wp-content/uploads/2024/06/wp312-rev_Yariv_SequentialSampling.pdf

File Function

Jel

C91, C92, D72, D83, D87

Keyword(s)

Collective Choice, Experiments, Information Acquisition

Suppress

false

Series

3