Information Aggregation Paradox

The more complex a collective decision-making mechanism is designed to be, and the more it attempts to prevent manipulation by individual participants, the more vulnerable it becomes to exploitation through unanticipated pathways by well-motivated and well-resourced actors. This reflects an impossibility theorem in decentralized governance: no system can simultaneously satisfy decentralization, manipulation-resistance, and information efficiency.

Read the daily articles behind this idea on the Chinese edition.