Project A2:

The role of asymmetric information in political reform processes

 

Coordinator:

Prof. Dr. Hans Peter Grüner

  

 Researchers:

Fabian Greimel / Carl-Christian Groh / Charles Louis-Sidois / Lukas Neuhauser / Marco Reuter / Inken Frederike Töwe


Associates:

Pierre Boyer, Ph.D. / Dr. Daniel Müller / Sander Renes, Ph.D. / Dr. Philipp Zahn

 Duration:01.01.2018 - 31.12.2021

 

Summary

This project theoretically and empirically investigates the role of asymmetric information in collective decisions about political reforms. Our objective is to understand to what extent reform failures can be attributed to information asymmetries and to find out how such failures can be mitigated by improving (i) the design of reform proposals, and (ii) political institutions that govern reform processes. Under perfect information, efficient contracting on political reforms would be possible. Those who benefit from a reform measure could then compensate those who lose. However, in practice, voters, politicians and experts often have relevant private information (and may have different beliefs) about the consequences of a reform. We theoretically investigate the requirements that allow the successful (efficient) aggregation of individual preferences for political reforms when information about the gains and losses is imperfect and dispersed. A focus lies on constructing compensation packages to overcome resistance against reforms. The project also uses survey data to empirically study the support for certain reform packages and compensation schemes. In the third funding period, we will move the focus of the project to practical applications in different policy areas. Our objective is to make our results useful for the practical design of reform proposals and for institutional reforms.