Wisdom of the Crowd? Information Aggregation in Representative Democracy

In representative democracy, voters elect candidates who strategically propose policies. In a common value environment with imperfectly informed voters and candidates, we establish that intermediation by candidates can render information aggregation unfeasible even when a large electorate presented with exogenous options would almost always select the correct policy. In fact, the possibility of information aggregation encourages candidates' conformism and stifles the competition among ideas. Neither liberalizing access to candidacy nor introducing additional frictions in voters information guarantees feasible information aggregation. Thus, the political failure we uncover is due to the intermediation by candidates---that is, the nature of representative democracy.