Promises in Group Decision Making
Labsi Working Papers, N. 51/2018
26 Pages Posted: 17 May 2018
Date Written: May 4, 2018
We assess in the laboratory the impact of promises on group decision-making. The gift-exchange game provides the testing ground for our experiment. When played between groups, inter-group cooperation and reciprocity represent a condition for efficiency in overall decision making. We find that promises have a significant positive effect on aggregate profits. We interpret these findings as if promises act as a trigger of social conformity, according to which groups adopt socially more desirable behavior even without face-to-face communication or discussion.
Keywords: Group Decision, Promise, Gift-Exchange Game, Efficiency, Social Conformity
JEL Classification: D81, D83
Suggested Citation: Suggested Citation