The More You Know, the Less You Learn: Information Monitoring and Decision-Making Bias
Keywords:
bureaucracy, informational politics, decision-making, Qing ChinaAbstract
Having credible information is crucial for improving politicians’ decision-making. Existing research suggests that expanding the range of information and access to first hand sources can enhance decision quality. However, quantitative evidence regarding the effect of information control, particularly on bureaucracies, remains scarce. Our study investigates an information monitoring reform within the Qing China bureaucracy in 1722. This reform enabled local officials in designated positions to report directly and confidentially to the emperor, thereby streamlining information flow and strengthening monitoring capabilities. Using a generalized difference-in-differences design, we find that the introduction of the information monitoring system surprisingly undermined the efficiency of governmental disaster relief allocation. Specifically, prefectures with more direct reporting positions were more likely to receive disaster relief programs, even in the absence of severe disasters. This bias arose from information overload caused by an expanded but uneven information supply, making the emperor more susceptible to being swayed by dominant information flows due to limited attention. Additionally, we identify a corrective mechanism for the emperor’s misjudgment. The emperor placed greater weight on the reports of trusted officials who shared his ethnicity or were members of the ruling class, thereby mitigating the negative effects of information overload. This study contributes to improving the understanding of the unintended consequences of bureaucratic information control.
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