Plausibility of Signals by a Heterogeneous Committee

Plausibility of Signals by a Heterogeneous Committee

2001Working Paper No. 1678

Krishna and Morgan (2001a) propose "amendments" to two of Gilligan and Krehbiel's (1987, 1988) theoretical studies of legislative signaling. The new results for homogeneous committees do not significantly change the empirical expectations of prior works, but the results for heterogeneous committees contradict earlier claims. With primary attention to heterogeneous committees, this note compares and contrasts the new and old equilibria and their empirical implications. The notion of signaling is somewhat nebulous in all such games but seems distinctively less plausible in the key Krishna-Morgan proposition than in prior legislative signaling games. Furthermore, the empirical literature on choice of rules-specifically, the positive relationship between committee heterogeneity and restrictive rules-is inconsistent with the Krishna-Morgan analysis but consistent with Gilligan-Krehbiel analyses, even though the former are informationally efficient while the latter are not.