Effort and Performance: What Distinguishes Interacting and Non-Interacting Groups from Individuals?
39 Pages Posted: 28 Apr 2011 Last revised: 8 May 2014
Date Written: March 10, 2014
We study how group membership affects behavior both when group members can and cannot interact with each other. Our goal is to isolate the contrasting forces that spring from group membership: a free-riding incentive leading to reduced effort and a sense of social responsibility that increases effort. In an environment with varying task difficulty and individual decision making as the benchmark, we show that the free-riding effect is stronger. Group members significantly reduce their effort in situations where they share the outcome but are unable to communicate. When group members share outcomes and can interact, they outperform groups without communication and individuals. We show that these groups do as well as the best constituent member would have done on her own.
Keywords: group behavior, decision making, free-riding, experiments
JEL Classification: C92, D71, Z13
Suggested Citation: Suggested Citation