When do groups perform better than individuals? A company takeover experiment

Marco Casari, Jingjing Zhang and Christine Jackson

No 504, IEW - Working Papers from Institute for Empirical Research in Economics - University of Zurich

Abstract: It is still an open question when groups perform better than individuals in intellectual tasks. We report that in a company takeover experiment, groups placed better bids than individuals and substantially reduced the winner�s curse. This improvement was mostly due to peer pressure over the minority opinion and to learning. Learning took place from interacting and negotiating consensus with others, not simply from observing their bids. When there was disagreement, what prevailed was not the best proposal but the one of the majority. Groups underperformed with respect to a �truth wins� benchmark although they outperformed individuals deciding in isolation.

Keywords: Winner�s curse; takeover game; group decision making; communication; experiments (search for similar items in EconPapers)
JEL-codes: C91 C92 D03 D81 (search for similar items in EconPapers)
Date: 2012-04
New Economics Papers: this item is included in nep-cbe, nep-cdm, nep-exp, nep-hpe and nep-mic
References: View complete reference list from CitEc
Citations: View citations in EconPapers (8)

Downloads: (external link)
https://www.zora.uzh.ch/id/eprint/62227/1/iewwp504.pdf (application/pdf)

Related works:
Working Paper: When Do Groups Perform Better than Individuals? A Company Takeover Experiment (2011)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:zur:iewwpx:504

Access Statistics for this paper

More papers in IEW - Working Papers from Institute for Empirical Research in Economics - University of Zurich
Bibliographic data for series maintained by Severin Oswald ().