The Decision Maker Matters: Individual versus Group Behaviour in Experimental Beauty-Contest Games

Martin Kocher and Matthias Sutter

Papers on Strategic Interaction from Max Planck Institute of Economics, Strategic Interaction Group

Abstract: Economics has devoted little attention so far as to whether the type of decision maker matters for economic decisions. However, many important decisions like those on monetary policy or a company's business strategy are made by (small) groups rather than an individual. We compare behaviour of individuals and small groups in an experimental beauty-contest game. Our findings suggest that groups are not smarter decision makers per se, but that they learn faster than individuals. When individuals compete against groups, the latter significantly outperform the former in terms of payoff.

Keywords: beauty-contest experiments; group behavior; individual behavior; learning (search for similar items in EconPapers)
JEL-codes: C72 C91 C92 D70 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2004-02
New Economics Papers: this item is included in nep-cbe, nep-exp, nep-mic and nep-pol
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (69)

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ftp://papers.econ.mpg.de/esi/discussionpapers/2004-09.pdf (application/pdf)

Related works:
Journal Article: The Decision Maker Matters: Individual Versus Group Behaviour in Experimental Beauty-Contest Games (2005)
Working Paper: The decision maker matters: Individual versus group behaviour in experimental beauty-contest games (2005)
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