Risk-Averse and Self-Interested Shifts in Groups in Both Median and Random Rules

Yoshio Kamijo and Teruyuki Tamura ()
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Teruyuki Tamura: School of Political Science and Economics, Tokai University, 4-1-1 Kitakaname, Tokyo 151-8677, Japan

Games, 2023, vol. 14, issue 1, 1-21

Abstract: The purpose of this study was to determine whether attitudes toward risk and altruism are affected by being in a group or being alone. In contrast to previous economic research on group decision-making, we excluded the effects of group informal discussions, which are thought to be a “black box” when individuals make decisions in a group. In this regard, the subjects in our experiment were only requested to show their faces to the other members, without further communication. Moreover, we adopted two collective decision rules, i.e., the median rule and the random rule, which provide the truth-telling mechanism. In the experiments of both anonymous investment and donation, we found that the subjects who made decisions in a group offered significantly lower amounts than those who made decisions alone, after controlling for individuals’ risk and altruistic preferences. The findings imply that people are more risk-averse and self-interested when they are in a group, regardless of which collective decision rules are adopted.

Keywords: group decision; individual decision; altruism; decision under risk (search for similar items in EconPapers)
JEL-codes: C C7 C70 C71 C72 C73 (search for similar items in EconPapers)
Date: 2023
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Working Paper: Risk-averse and self-interested shifts in groups in both median and random rules (2019)
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