Uncertainty and the Persuasion of Decision-making Groups

In many organizations, decisions are not made by a single person but by a group. These groups often base their decisions on the advice of outsiders. Out- siders that have superior information can transmit this information in dierent ways. Lobbyists and other interested parties can simply give a recommendation (which is equal to soft information) or write and send a detailed report (hard information). We show that in a situation where having information about pref- erences is endogenous, decision-makers have a clear incentive to strategically use this information to aect the lobbyist's choice for the mode of communi- cation. As decision-makers benet from having the freedom to read reports, they sometimes benet from keeping lobbyists in the dark about their initial preferences. In other cases, external certainty is preferable, as then the lobby- ist automatically lobbies the right decision-maker. From the perspective of the group as a whole, internal certainty is preferable, but counter-intuitively, in- ternal certainty does not always arise automatically, as members with extreme preferences prefer to appear moderate rather than extremist.