Cheap Talk and Collective Decision-Making: Voting Rules and Informed Decision Makers

We investigate a cheap talk model with a collective decision making. In our model multiple decision makers vote on a proposal which determines their payoffs, and an expert tries to persuade them to choose the outcome she prefers. We allow decision makers to possess not all but some of information regarding the state of nature, which determines the gross utility of them based on the voting outcome. Two different types of experts has been considered: a heavily biased expert who always wants a rejection and a surplus maximizing expert who tries to maximize the total surplus of the group of decision makers. We show that experts can transmit credible and influential information to voters by using their respective optimal cheap talk strategies and try to prevent voters from taking informative actions. This limited information aggregation induced by each type of experts results in either polarization or unification of the voters: the highly biased expert polarizes the voters to achieve her aim, while the surplus maximizing expert unifies them. Furthermore, with the highly biased expert, polarization among voters has been observed under any voting rules, but voters tend to be more conservative under a voting rule that requires less votes in favor. JEL Classification Numbers: