Group decision-making in the shadow of disagreement

Kfir Eliaz, Debraj Ray, Ronny Razin

    Research output: Contribution to journalArticle

    Abstract

    A model of group decision-making is studied, in which one of two alternatives must be chosen. While agents differ in their preferences over alternatives, everybody prefers agreement to disagreement. Our model is distinguished by three features: private information regarding valuations, differing intensities in preferences, and the option to declare neutrality to avoid disagreement. There is always an equilibrium in which the majority is more aggressive in pushing its alternative, thus enforcing their will via both numbers and voice. However, under general conditions an aggressive minority equilibrium inevitably makes an appearance, provided that the group is large enough. Such equilibria invariably display a "tyranny of the minority": the increased aggression of the minority always outweighs their smaller number, leading to the minority outcome being implemented with larger probability than the majority alternative. We fully characterize the asymptotic behavior of this model as group size becomes large, and show that all equilibria must converge to one of three possible limit outcomes.

    Original languageEnglish (US)
    Pages (from-to)236-273
    Number of pages38
    JournalJournal of Economic Theory
    Volume132
    Issue number1
    DOIs
    StatePublished - Jan 1 2007

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    Keywords

    • Decision-making
    • Groups
    • Pivotality
    • Preference intensities

    ASJC Scopus subject areas

    • Economics and Econometrics

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