Collective Information Acquisition

Abstract

We consider the problem faced by a group of players who bargain over what public signal to acquire before deciding on a collective action. The players differ in their privately known state-dependent payoffs from taking the action, and therefore differ also in their willingness to pay for the public signal. We take a mechanism design approach to characterizing the efficient frontier of outcomes achievable via bargaining over information. We identify novel distortions in the optimal information structure that arise from the information asymmetry and from the fact that after the signal is realized, the outcome is determined in equilibrium of a subsequent voting game.