Scandinavian Working Papers in Economics

Working Papers,
Lund University, Department of Economics

No 2000:5: Politically Correct Information Adoption

Håkan Holm ()
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Håkan Holm: Department of Economics, Lund University, Postal: Department of Economics, School of Economics and Management, Lund University, Box 7082, S-220 07 Lund, Sweden

Abstract: This paper analyses the case when the political struggle not is channeled through policy choices, but through what information to adopt. The paper presents a simple model to analyze collective decisions of adopting new information when different parties' payoffs are contingent upon the new information. In equilibrium we demonstrate that the adopted information is biased towards “political correctness” rather than being informative (in the Blackwell sense). These results may be relevant when designing decision mechanisms for institutions that are to be keen on new information.

Keywords: Informativeness; Majority Rule; Political Correctness

JEL-codes: D23; D70; D72; D81; L30

23 pages, July 28, 2000

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