Costly information acquisition. Is it better to toss a coin?

This paper presents a strategic model of common value elections with endogenous information acquisition. It proves that majoritarian elections can fail to aggregate information when voters have heterogeneous skills. Informational inefficiencies can be partially corrected by improving the skills of the electors as the population increases, or by limiting participation to the most competent citizens. The first interpretation is consistent with Rousseau’s view that an educated citizenry is necessary for a functioning democracy, while the second provides a rational foundation for epistocratic government. JEL Classification Numbers: C72, D72, D82.