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Same process, different outcomes: group performance in an acquiring a company experiment

Published online by Cambridge University Press:  14 March 2025

Marco Casari ,
Jingjing Zhang  and
Christine Jackson
Marco Casari
Affiliation:
Department of Economics, University of Bologna, Piazza Scaravilli 2, 40126 Bologna, Italy
Jingjing Zhang*
Affiliation:
Economics Discipline Group, University of Technology Sydney, 14-28 Ultimo Road, Ultimo, NSW 2007, Australia
Christine Jackson
Affiliation:
Krannert School of Management, Purdue University, 403 W. State St., West Lafayette, IN 47906-2056, USA
*
[email protected]
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Abstract

It is still an open question when groups perform better than individuals in intellective tasks. We report that in an Acquiring a Company game, what prevailed when there was disagreement among group members was the median proposal and not the best proposal. This aggregation rule explains why groups underperformed with respect to a “truth wins” benchmark and why they performed better than individuals deciding in isolation in a simple version of the task but worse in the more difficult version. Implications are drawn on when to employ groups rather than individuals in decision making.

Keywords

Winner’s curseGroup decision makingCommunicationRisky shiftHerd behaviorC91C92D03D81
Type
Original Paper
Information
Experimental Economics , Volume 19 , Issue 4 , December 2016 , pp. 764 - 791
Copyright
Copyright © 2015 Economic Science Association

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Footnotes

Electronic supplementary material The online version of this article (doi:https://doi.org/10.1007/s10683-015-9467-7) contains supplementary material, which is available to authorized users.

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