Voting and communication when hiring by committee

Abstract

We consider a committee of principals who gather to vote whether or not to renew a fixed-term employment contract of an agent. The principals’ private preferences depend on the agent’s past performance and the voting outcome. We analyze two scenarios: One where all communication is prohibited and the other where the principals engage in a pre-vote deliberation. We characterize the set of symmetric, responsive equilibria of the pure voting game and show that informative voting constitutes an equilibrium whenever the number of votes required for the reappointment is sufficiently high. We then establish that if the principals can communicate prior to casting the decisive ballots, truthful information sharing coincides with Nash equilibrium behavior. However, in contrast to the common conception, sometimes pre-vote deliberation may actually make the principals worse off. The underlying intuition is that absent deliberation, the principals are unable to coordinate their votes, and this may force the agent to perform at a level beyond that in the game with communication.