Same Process, Different Outcomes: Group Performance in an Acquiring a Company Experiment

42 Pages Posted: 11 Jan 2016

See all articles by Marco Casari

Marco Casari

University of Bologna - Department of Economics

Jingjing Zhang

University of Technology, Sydney - Faculty of Business - Center for Health Economics Research and Evaluation (CHERE)

Christine Jackson

Purdue University

Abstract

It is still an open question when groups perform better than individuals in intellective tasks. We report that in an Acquiring a Company game, what prevailed when there was disagreement among group members was the median proposal and not the best proposal. This aggregation rule explains why groups underperformed with respect to a "truth wins" benchmark and why they performed better than individuals deciding in isolation in a simple version of the task but worse in the more difficult version. Implications are drawn on when to employ groups rather than individuals in decision making.

Keywords: winner's curse, group decision making, communication, risky shift, herd behavior

JEL Classification: C91, C92, D03, D81

Suggested Citation

Casari, Marco and Zhang, Jingjing and Jackson, Christine, Same Process, Different Outcomes: Group Performance in an Acquiring a Company Experiment. IZA Discussion Paper No. 9614. Available at SSRN: https://ssrn.com/abstract=2713035

Marco Casari (Contact Author)

University of Bologna - Department of Economics ( email )

Strada Maggiore 45
Bologna, 40125
Italy

Jingjing Zhang

University of Technology, Sydney - Faculty of Business - Center for Health Economics Research and Evaluation (CHERE) ( email )

Sydney NSW 2000
Australia

Christine Jackson

Purdue University ( email )

610 Purdue Mall
West Lafayette, IN 47907
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
16
Abstract Views
171
PlumX Metrics