Research

Does transparency about others’ information acquisition improve majority decisions? We run a theoretically-informed lab experiment in which voters first choose whether to buy costly signals of varying quality, then decide by majority rule in a common interest environment. We randomly vary whether or not participants can observe others’ acquisition choices and the resulting signals. In less transparent environments, less-informed members abstain more and committees aggregate information less efficiently. Transparency encourages information acquisition, raises participation, and thereby improves efficiency. These patterns are consistent with a theoretical model that predicts a swing-voter’s curse (SVC) in less transparent environments if less-informed members abstain. This result resolves a question raised by theory: Our standard model of voting and information acquisition shows that whilst the SVC is a potential equilibrium, it is also theoretically possible for opaque regimes to match efficient aggregation if all group members vote according to their private signals. This study provides the first causal experimental evidence that transparency about endogenous information acquisition improves voting outcomes and overall committee efficiency.

Threshold uncertainty has been previously shown to impede the efficient provision of threshold public goods. Do groups perform better when their members can acquire information on the location of the threshold? We conduct an online experiment on threshold public good provision where participants can simultaneously choose to buy private clues about the location of the threshold. Each group contains two low-risk and two high-risk members who differ in their expected loss from failing to reach the threshold. We find that groups reach the threshold less frequently when group members can acquire information than when no information acquisition is possible. We attribute this to optimism: individuals acquire too little information to adequately update their priors about the true threshold value, resulting in too low contributions. Low-risk members are disproportionately responsible for the failure of collective action. Our findings suggest that giving individuals a possibility to learn via private information acquisition is insufficient in solving the problem of threshold uncertainty.

We experimentally examine individuals’ attitudes toward unequal outcome distributions arising from procedures characterised by unequal ex-ante opportunities. Specifically, we elicit participants’ willingness to accept the realised allocations from simple two‑player lottery games in which players face systematically different probabilities of winning. We hypothesise that ex-post acceptance of such unequal outcomes may be influenced by two dimensions: (1) whether participation in the game is based on explicit ex-ante consent versus exogenous assignment, and (2) whether individual outcome realisations are statistically independent or correlated. Our experimental results indicate that neither dimension exerts a statistically significant effect on ex-post acceptance. Acceptance rates are lower when chances are unequal, but we observe surprisingly high acceptance rates even in our biased treatments. This suggests that outcome-generating mechanisms involving randomness may be perceived as fair even when they are substantially biased.

We examine a reader’s decision to pay to consume traditional media news while having the option to browse free information available on social media. We show that a reader’s prior, the access-cost of traditional media, as well as the relative inaccuracy of information on social media compared to traditional media, all impact this decision. Surprisingly, we find that when social media accuracy and cost of accessing traditional media are both relatively low, social media can increase the demand of traditional media by enhancing the value of its information to some readers. This effect can persist even if social media becomes incrementally more accurate via fact-checking. There are also circumstances when the presence of social media can boost the subscription revenue of traditional media. However, when social media and traditional media information have similarly high accuracy, the former mostly acts as a substitute and lowers the subscription revenue of traditional media.