EconPapers    
Economics at your fingertips  
 

Too Much Trust in Group Decisions: Uncovering Hidden Profiles by Groups and Markets

Boris Maciejovsky () and David V. Budescu ()
Additional contact information
Boris Maciejovsky: School of Business, University of California, Riverside, Riverside, California 92521
David V. Budescu: Department of Psychology, Fordham University, Bronx, New York 10458

Organization Science, 2020, vol. 31, issue 6, 1497-1514

Abstract: A crucial challenge for organizations is to pool and aggregate information effectively. Traditionally, organizations have relied on committees and teams, but recently many organizations have explored the use of information markets. In this paper, the authors compared groups and markets in their ability to pool and aggregate information in a hidden-profiles task. In Study 1, groups outperformed markets when there were no conflicts of interest among participants, whereas markets outperformed groups when conflicts of interest were present. Also, participants had more trust in groups to uncover hidden profiles than in markets. Study 2 generalized these findings to a simple prediction task, confirming that people had more trust in groups than in markets. These results were not qualified by conflicts of interest. Drawing on experienced forecasters from Good Judgment Open, Study 3 found that familiarity and experience with markets increased the endorsement and use of markets relative to traditional committees.

Keywords: trust; markets; groups; decision making; prediction markets (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://doi.org/10.1287/orsc.2020.1363 (application/pdf)

Related works:
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:inm:ororsc:v:31:y:2020:i:6:p:1497-1514

Access Statistics for this article

More articles in Organization Science from INFORMS Contact information at EDIRC.
Bibliographic data for series maintained by Chris Asher ().

 
Page updated 2025-03-19
Handle: RePEc:inm:ororsc:v:31:y:2020:i:6:p:1497-1514