Correlation Neglect, Voting Behavior, and Information Aggregation
American Economic Review · 2015 · Volume 105 · Issue 4
Abstract
In this paper we analyze elections when voters underestimate the correlation between their information sources ("correlation neglect"). We find that this cognitive bias can improve political outcomes. We show that the extreme beliefs which result from correlation neglect induce some voters to base their vote on information rather than on political preferences. We characterize conditions on the distribution of preferences under which this induces higher vote shares for the optimal policies and better information aggregation. (JEL D72, D83)
Keywords
Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior, Search, Learning, Information and Knowledge, Communication, Belief, Unawareness
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