Hostname: page-component-74656f9884-skzmx Total loading time: 0 Render date: 2026-11-04T20:16:02.522Z Has data issue: false hasContentIssue false
  • English
  • Français

Exploring group decision making in a power-to-take experiment

Published online by Cambridge University Press:  14 March 2025

Ronald Bosman ,
Heike Hennig-Schmidt  and
Frans van Winden
Ronald Bosman*
Affiliation:
Monetary and Economic Policy Department, De Nederlandsche Bank, Postbus 98, 1000 AB Amsterdam
Heike Hennig-Schmidt*
Affiliation:
Department of Economics, Laboratorium für experimentelle Wirtschaftsforschung, Bonn University, Adenauerallee 24-42, D-53113 Bonn, Germany
Frans van Winden*
Affiliation:
CREED/Department of Economics, University of Amsterdam, Roetersstraat 11, 1018 WB Amsterdam, The Netherlands
*
e-mail: r.a.j.bosman@dnb.nl
e-mail: hschmidt@uni-bonn.de
e-mail: f.a.a.m.vanwinden@uva.nl
Get access Rights & Permissions [Opens in a new window]

Abstract

Most studies that compare individual and group behavior neglect the in-group decision making process. This paper explores the decision making process within groups in a strategic setting: a two player power-to-take experiment. Discussions preceding group decisions are video taped and analyzed. We find the following: (1) no impact of the group setting as such on individual behavior; (2) heterogeneity of individual types; (3) perceptions of fairness are hardly discussed and are prone to the self-serving bias; (4) groups ignore the decision rule of other groups and typically view them as if they were single agents. (5) We also show that to explain group outcomes two factors have to be taken into account that are often neglected: the distribution of individual types over groups and the decision rules that groups use to arrive at their decision.

Keywords

GroupsDecision ruleFairnessExperimentVideo

JEL classification

A12: Relation of Economics to Other Disciplines C91: Laboratory, Individual Behavior C92: Laboratory, Group Behavior C72: Noncooperative Games

Information

Type
Research Article
Information
Experimental Economics , Volume 9 , Issue 1 , April 2006 , pp. 35 - 51
Copyright
Copyright © 2006 Economic Science Association

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Article purchase

Temporarily unavailable

References

Andreoni, J., Castillo, M., & Petrie, R. (2003). What do bargainers’ preferences look like? Experiments with a convex ultimatum game. American Economic Review, 93, 672–685.CrossRefGoogle Scholar
Babcock, L., & Loewenstein, G. (1997). Explaining bargaining impasse. The role of self-serving bias. Journal of Economic Perspectives, 11, 109–126.CrossRefGoogle Scholar
Bakeman, R. (2000). Behavioral observation and coding. In Reis, H.T. and Judd, Ch. M. (eds.), Handbook of research methods in social and personality psychology, 138–159. Cambridge: Cambridge University Press. UK.Google Scholar
Bolton, G. E., & Zwick, R. (1995). Anonymity versus punishment in ultimatum bargaining. Games and Economic Behavior, 10, 95–121.CrossRefGoogle Scholar
Bone, J., Hey, J., & Suckling, J. (1999). Are groups more (or Less) consistent than individuals?. Journal of Risk and Uncertainty, 8, 63–81.10.1023/A:1007764411446CrossRefGoogle Scholar
Bornstein, G. (2003). Intergroup Conflict. Individual, Group, and Collective Interests. Personality and Social Psychology Review, 7, 129–145.10.1207/S15327957PSPR0702_129-145CrossRefGoogle ScholarPubMed
Bornstein, G., & Yaniv, I. (1998). Individual and group behavior in the ultimatum game. Are groups more rational players? Experimental Economics, 1, 101–108.CrossRefGoogle Scholar
Bornstein, G., Kugler, T., & Ziegelmeyer, A. (2004). Individual and group decisions in the centipede game: Are groups more rational players? Journal of Experimental Social Psychology, 40, 599–605.CrossRefGoogle Scholar
Bornstein, G., Budescu, D. V., Kugler, T., & Selten, R. (2005). Repeated price competition between individuals and between teams. Working paper. The Hebrew University. Jerusalem.Google Scholar
Bosman, R., & van Winden, F. (2002). Emotional Hazard in a Power-to-Take Experiment. The Economic Journal, 112, 146–69.10.1111/1468-0297.0j677CrossRefGoogle Scholar
Bottom, W. P., Krishna, L., & Miller, G. J. (2002). Propagation of individual bias through group judgment. Error in the treatment of asymmetrically informative signals. Journal of Risk and Uncertainty, 25, 147–163.10.1023/A:1020643713354CrossRefGoogle Scholar
Brosig, J., Ockenfels, A., & Weimann, J. (2003). The effect of communication media on cooperation. German Economic Review 4, 217–241.CrossRefGoogle Scholar
Camerer, C.F. (2003). Behavioral game theory. Princeton: Princeton University Press.Google Scholar
Cason, T. N., & Mui, V. -L. (1997). A laboratory study of group polarization in the team dictator game. Economic Journal, 107, 1465–83.CrossRefGoogle Scholar
Cooper, D. J., & Kagel, J. H. (2005). Are two heads better than one? Team versus individual play in signaling games. The American Economic Review, 95, 477–509.10.1257/0002828054201431CrossRefGoogle Scholar
Corden, R. (2001). Group discussion and the importance of a shared perspective. Learning from collaborative research. Qualitative-Research, 1, 347–367.CrossRefGoogle Scholar
Cox, J. C., & Hayne, S. C. (2002). Barking up the wrong tree. Are small groups rational agents? Working Paper. University of Arizona.Google Scholar
Dahl, G. B., & Ransom, M. R. (1999). Does where you stand depend on where you sit? Tithing donations and self-serving bias. American Economic Review, 89, 703–727.CrossRefGoogle Scholar
Davis, J.H. (1973). Group decision and social interaction. Theory of social decision schemes. Psychological Review, 80, 97–125.10.1037/h0033951CrossRefGoogle Scholar
van Dijk, F., Sonnemans, J., & van Winden, F. (2001). Incentive systems in a real effort experiment. European Economic Review, 45, 187–214.CrossRefGoogle Scholar
Endres, J., Poggenpohl, C., & Erben, C. (1999). Repetitions, warnings and video. Cognitive and motivational components in preschool children's suggestibility. Legal and Criminological Psychology, 4, 129–146.10.1348/135532599167725CrossRefGoogle Scholar
Fehr, E., & Schmidt, K. M. (1999). A theory of fairness, competition, and cooperation. Quarterly Journal of Economics, 114, 817–68.10.1162/003355399556151CrossRefGoogle Scholar
Fischbacher, U., Gachter, S., & Fehr, E. (2001). Are people conditionally cooperative? Evidence from a public goods experiment. Economics Letters, 71, 397-404 Frijda, N. H. (1986). The emotions. Cambridge: Cambridge University Press.Google Scholar
Goren, H., & Bornstein, G. (2000). The effects of intragroup communication on intergroup cooperation in the repeated intergroup prisoner's dilemma (IPD) game. Journal of Conflict Resolution, 44(5), 700–719.10.1177/0022002700044005007CrossRefGoogle Scholar
Guarnaschelli, S., McKelvey, R. D., & Palfrey, Th. R. (2000). An experimental study of jury decision rules. American Political Science Review, 94, 407–423.10.2307/2586020CrossRefGoogle Scholar
Hennig-Schmidt, H. (1999). Bargaining in a video experiment. Determinants of boundedly rational behavior New York: Springer 1999.10.1007/978-3-642-45775-3_4CrossRefGoogle Scholar
Hennig-Schmidt, H. (2002). The impact of fairness on decision making-An analysis of different video experiments. In F. Andersson, and H. Holm (eds.), Experimental Economics. Financial Markets. Auctions. and Decision Making. Dordrecht: Kluwer Academic Publishers, 185-210 Hoffman, E., McCabe, K., & Smith, V. (1996). Social distance and other-regarding behavior. American Economic Review, 86, L653–60.Google Scholar
Kerr, N. L., Kramer, G. P., & MacCoun, R. J. (1996). Bias in Judgment. Comparing Individuals and Groups, Psychological Review, 103, 687–719.Google Scholar
Kerr, N. L., Niedermeier, K. E., & Kaplan, M. F. (1999). Bias in Jurors vs. Bias in Juries. New Evidence from the SDS Perspective. Organizational Behavior and Human Decision Processes, 80, 70–86.10.1006/obhd.1999.2855CrossRefGoogle ScholarPubMed
Kocher, M. G., & Sutter, M. (2002). Individual versus group behavior and the role of the decision making process in gift-exchange experiments. Papers on Strategic Interaction. 27/2002. Max-Planck-Institute for Research into Economic Systems.Google Scholar
Kocher, M. G., & Sutter, M. (2005). The ‘Decision Maker’ matters. Individual versus team behavior in experimental ‘Beauty-Contest’ games. Economic Journal, 115, 200–22310.1111/j.1468-0297.2004.00966.xCrossRefGoogle Scholar
Laughlin, P. R. (1999). Collective induction. Twelve postulates. Organizational behavior and human decision processes, 80, 50–69.10.1006/obhd.1999.2854CrossRefGoogle ScholarPubMed
Levine, J. M. (1999). Transforming individuals into groups. Some hallmarks of the SDS approach to small group research. Organizational Behavior and Human Decision Processes, 80, 21–27.10.1006/obhd.1999.2852CrossRefGoogle ScholarPubMed
Loomes, G. (1999). Some lessons from past experiments and some challenges for the future. The Economic Journal, 109, F35–F45.10.1111/1468-0297.00401CrossRefGoogle Scholar
Messick, D. M., Moore, D.A., & Bazerman, M.H. (1997). Ultimatum bargaining with a group. Underestimating the importance of the decision rule. Organizational Behavior and Human Decision Processes, 69, 87–101.10.1006/obhd.1997.2678CrossRefGoogle Scholar
Orbell, J. M., Dawes, R. M., & van der Kragt, A. J. C. (1988). Explaining discussion-induced cooperation. Journal of personality and social psychology 5, 811–819.10.1037/0022-3514.54.5.811CrossRefGoogle Scholar
Potter, J. (1996). Discourse analysis. Theoretical background. In Richardson, J.T.E. (Ed.), Handbook of Qualitative Research Methods for Psychology and the Social Sciences. Leicester: The British Psychological Society, 125–140.Google Scholar
Raab, Ph., Schipper, B. C. (2004). Cournot Competition between Teams. An experimental study. Bonn graduate school of economics. University of Bonn. Discussion Paper No. 13/2004.Google Scholar
Ratcliff, D. (2003). Video methods in qualitative research. In Camic, P. M. Rhodes, J.E., and Yardley, L. (eds.), Qualitative research in psychology. expanding perspectives in methodology and design. Washington. DC: American Psychological Association 113–129.10.1037/10595-007CrossRefGoogle Scholar
Robert, C., & Carnevale, P. J. (1997). Group choice in ultimatum bargaining. Organizational Behavior and Human Decision Processes, 72, 256–279.10.1006/obhd.1997.2738CrossRefGoogle Scholar
Rockenbach, B., Sadrieh, A., & Mathauschek, B. (2005). Teams take the better risk. Journal of Economic Behavior and Organization (forthcoming).Google Scholar
Rutstrom, E. E. L., & Williams, M. B. (2000). Entitlements and fairness. An experimental study of distributive preferences. Journal of Economic Behavior and Organization, 43, 75–89.Google Scholar
Stasser, G. (1999). A primer of social decision scheme theory. Models of group influence, Competitive model testing, and prospective modeling. Organizational Behavior and Human Decision Processes, 80, 3–20.10.1006/obhd.1999.2851CrossRefGoogle ScholarPubMed
Wildshut, T., Pinter, B., Vevea, J. L., Insko, Ch. A., & Schopler, J. (2003). Beyond the groupmind. A quantitative review of the interindividual-Intergroup discontinuity effect. Psychological Bulletin. 129. 5, 698–722.10.1037/0033-2909.129.5.698CrossRefGoogle Scholar