Information Transmission and Aggregation
This award funds research that uses game theory to analyze situations where information has an important effect on how individual decisions lead to group outcomes.
The first part of the project considers whether and how political systems lead to the implementation of efficient policies. A key feature of any real world political system is that information is dispersed across citizens, policy-makers, government executives, and legislators. Social scientists now have a fairly well developed understanding of how elections aggregate voters' information in a representative democracy, but we do not yet know whether or not politicans' or parties' information is also disseminated and aggregated in an efficient way. The researcher will use a novel model of electoral competition between office-motivated candidates with private information to answer this question.
The second part of the research develops a new approach to studying strategic information transmission. The key idea is that conventions of natural language can be formally captured by imposing a weak restriction on the space of available strategies. While the restriction by itself does nothing to affect the essence of the strategic possibilities, it mitigates one source of multiplicity in games. Given the formal restruction capturing conventions, the second step is to apply iterative admissability, ie to iteratively delete weakly dominated strategies. The new approach provides sharp and robust predictions. The project includes an investigation of this approach to broader classes of games.