Abstract
Leaks are pervasive in politics. Hence, many committees that nominally operate under secrecy de facto operate under the threat that information might be passed on to outsiders. We study theoretically and experimentally how this possibility affects the behavior of committee members and the decision-making accuracy. Our theoretical analysis generates two major predictions. First, a committee operating under the threat of leaks is equivalent to a formally transparent committee in terms of the probabilities of project implementation as well as welfare (despite differences in individual voting behavior). Second, the threat of leaks causes a committee to recommend rejection of a project whenever precise information has been shared among committee members. As a consequence, a status-quo bias arises. Our laboratory results confirm these predictions despite subjects communicating less strategically than predicted.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.