Robust Aggregation of Preferences

Abstract

This paper analyzes a society composed of individuals who have diverse sets of beliefs (or models) and diverse tastes (or utility functions). It characterizes the model selection process of a social planner who wishes to aggregate individuals' beliefs and tastes but is concerned that their beliefs are misspecified (or incorrect). A novel impossibility result emerges under several desiderata: a utilitarian social planner who prioritizes robustness to misspecification never aggregates individuals' beliefs but instead behaves as a dictator by adopting one individual's belief as the social belief. This tension between robustness and aggregation exists because aggregation yields policy-contingent beliefs, which are very sensitive to policy outcomes. The impossibility can be resolved, but it would require assuming individuals have heterogeneous tastes and some common beliefs. Applications in treatment choice and dynamic macroeconomics are explored.