Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/168094
Authors: 
Mechtenberg, Lydia
Büchel, Berno
Year of Publication: 
2017
Series/Report no.: 
Beiträge zur Jahrestagung des Vereins für Socialpolitik 2017: Alternative Geld- und Finanzarchitekturen - Session: Networks, Organizations and Firms D09-V2
Abstract: 
We study private communication in social networks prior to a majority vote on two alternative policies. Some (or all) agents receive a private imperfect signal about which policy is correct. They can, but need not, recommend a policy to their neighbors in the social network prior to the vote. We show that communication can undermine effciency of the vote and hence reduce welfare in a common interest setting. We test the model in a lab experiment and find strong support for the predicted effects.
JEL: 
D72
D83
D85
C91
Document Type: 
Conference Paper

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