Individual vs. group decision-making: an experiment on dynamic choice under risk and ambiguity

Enrica Carbone (), Konstantinos Georgalos and Gerardo Infante
Additional contact information
Enrica Carbone: University of Campania “Luigi Vanvitelli”

Theory and Decision, 2019, vol. 87, issue 1, No 4, 87-122

Abstract: Abstract This paper focuses on the comparison of individual and group decision-making, in a stochastic inter-temporal problem in two decision environments, namely risk and ambiguity. Using a consumption/saving laboratory experiment, we investigate behaviour in four treatments: (1) individual choice under risk; (2) group choice under risk; (3) individual choice under ambiguity and (4) group choice under ambiguity. Comparing decisions within and between decision environments, we find an anti-symmetric pattern. While individuals are choosing on average closer to the theoretical optimal predictions, compared to groups in the risk treatments, groups tend to deviate less under ambiguity. Within decision environments, individuals deviate more when they choose under ambiguity, while groups are better planners under ambiguity rather than under risk. Our results extend the often observed pattern of individuals (groups) behaving more optimally under risk (ambiguity), to its dynamic dimension.

Keywords: Risk; Ambiguity; Inter-temporal optimisation; Group decision-making; Learning; Experiment (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://link.springer.com/10.1007/s11238-019-09694-8 Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Individual vs. Group Decision Making: an Experiment on Dynamic Choice under Risk and Ambiguity (2016)
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:kap:theord:v:87:y:2019:i:1:d:10.1007_s11238-019-09694-8

Ordering information: This journal article can be ordered from
http://www.springer. ... ry/journal/11238/PS2

DOI: 10.1007/s11238-019-09694-8

Access Statistics for this article

Theory and Decision is currently edited by Mohammed Abdellaoui

More articles in Theory and Decision from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().