Power of Joint Decision-Making in a Finitely-Repeated Dilemma

Kamei, Kenju (2015): Power of Joint Decision-Making in a Finitely-Repeated Dilemma.

Abstract

Teams are known to behave differently from individuals, but whether they behave more cooperatively or selfishly is still unsettled in the literature. We let subjects form two-person pairs and play a finitely-repeated two-player public goods game with other pairs, where each person knows the identity of the partner in their pair, and then compare the pairs’ behavior with the behavior of individuals in the same game played against individuals. Pairs contribute significantly more than individuals, especially when they are matched with other pairs for the entire periods. Possible factors that drove this result are discussed in the paper.

• Item Type: MPRA Paper
• Language: English
• Keywords: experiment, cooperation, dilemma, team work, public goods
• Subjects: C - Mathematical and Quantitative Methods > C9 - Design of Experiments > C91 - Laboratory, Individual Behavior; C - Mathematical and Quantitative Methods > C9 - Design of Experiments > C92 - Laboratory, Group Behavior

References

Andreoni, James, 1988. “Why free ride? Strategies and learning in public goods experiments,” Journal of Public Economics 37: 291-304.

Andreoni, James and John H. Miller, 1993. “Rational Cooperation in the Finitely Repeated Prisoner's Dilemma: Experimental Evidence,” Economic Journal 103: 570-585.

Babcock, Philip, Kelly Bedard, Gary Charness, John Hartman and Heather Royer, 2015. “Letting Down the Team? Social Effects of Team Incentives.” Journal of the European Economic Association 13: 841-870.

Cason, Timothy and Vai-Lam Mui, 1997. “A Laboratory Study of Group Polarisation in the Team Dictator Game,” Economic Journal 107: 1465-1483.

Charness, Gary and Matthias Sutter, 2012. “Groups Make Better Self-Interested Decisions,” Journal of Economic Perspective 26: 157-176.

Chaudhuri, Ananish, 2011. “Sustaining Cooperation in Laboratory Public Goods Experiments: A Selective Survey of the Literature.” Experimental Economics 14: 47-83.

Cooper, David J. and John Kagel, 2005. “Are Two Heads Better Than One? Team versus Individual Play in Signaling Games.” American Economic Review 95: 477-509.

Fehr, Ernst, and Simon Gächter, 2000. “Cooperation and punishment in public goods experiments,” American Economic Review 90: 980-994.

Fehr, Ernst, and Simon Gächter, 2002. “Altruistic punishment in humans,” Nature 415: 137-140.

Feri, Francesco, Bernd Irlenbusch and Matthias Sutter, 2010. “Efficiency Gains from Team-Based Coordination—Large-Scale Experimental Evidence.” American Economic Review 100: 1892-1912.

Fischbacher, Urs, 2007. “z-Tree: Zurich Toolbox for Ready-made Economic Experiments.” Experimental Economics 10: 171-178.

Fischbacher, Urs, Simon Gächter and Ernst Fehr, 2001. “Are people conditionally cooperative? Evidence from a public goods experiment,” Economics Letters 71: 397-404.

Fischbacher, Urs and Simon Gachter, 2010. “Social Preferences, Beliefs, and the Dynamics of Free Riding in Public Goods Experiments.” American Economic Review 100: 541-56.

Gächter, Simon and Christian Thöni, 2010. “Social Learning and Voluntary Cooperation among Like-Minded People,” Journal of European Economic Association 3: 303-314.

Gillet, Joris, Arthur Schram and Joep Sonnemans, 2009. “The Tragedy of the Commons Revisited: The Importance of Group Decision-Making,” Journal of Public Economics 93: 785-797.

Greiner, Ben, 2003. “An Online Recruitment System for Economic Experiments.” In: Kurt Kremer, Volker Macho (Eds.): Forschung und wissenschaftliches Rechnen. GWDG Bericht 63, Goettingen : Ges. fuer Wiss. Datenverarbeitung, 79-93.

Gunnthorsdottir, Anna, Daniel Houser, and Kevin McCabe, 2007. “Disposition, history and contributions in public goods experiments,” Journal of Economic Behavior & Organization 62: 304-315.

Kamei, Kenju and Louis Putterman, forthcoming, “Play it Again: Partner Choice, Reputation Building and Learning from Finitely-Repeated Dilemma Games,” Economic Journal (in press).

Kagel, John H. and McGee, Peter, forthcoming, “Team versus Individual Play in Finitely Repeated Prisoner Dilemma Games,” American Economic Journal: Microeconomics.

Kocher, Martin and Mattias Sutter, 2005. “The Decision Maker Matters: Individual versus Group Behavior in Experimental Beauty-Contest Games,” Economic Journal 115: 200-223.

Kreps, David, Paul Milgrom, John Roberts and Robert Wilson, 1982. “Rational Cooperation in the Finitely Repeated Prisoners’ Dilemma,” Journal of Economic Theory 27: 245-52.

Ledyard, John, 1995. “Public goods: A survey of experimental research.” In J. H. Kagel and A.E. Roth (eds.), The Handbook of Experimental Economics 111-194, Princeton University Press.

Luhan, Wolfgang, Martin Kocher and Matthias Sutter, 2009. “Group polarization in the team dictator game reconsidered,” Experimental Economics 12: 26-41.

Masclet, David, Charles Noussair, Steven Tucker and Marie-Claire Villeval, 2003. “Monetary and Nonmonetary Punishment in the Voluntary Contributions Mechanism,” American Economic Review 93: 366-380.

Moscovici Serge and Marisa Zavalloni, 1969. “The Group as a Polarizer of Attitudes,” Journal of Personality and Social Psychology 12(2): 125-35.

Ostrom, Elinor, 1990. Governing the Commons: The Evolution of Institutions for Collective Action, Cambridge University Press.

Page, Talbot, Louis Putterman and Bulent Unel, 2005. “Voluntary Association in Public Goods Experiments: Reciprocity, Mimicry, and Efficiency,” Economic Journal 115: 1032-1053.

Sobel, Joel, 2005. “Interdependent Preferences and Reciprocity,” Journal of Economic Literature, XLIII: 392-436.

Sunstein, Cass, 2007. Republic.com 2.0, Princeton University Press, New Jerney.

Sutter, Mattias, 2007. “Are Teams prone to myopic loss aversion? An Experimental Study on Individual Versus Team Investment Behavior,” Economics Letters 97: 128-132.

Zelmer, Jennifer, 2003. “Linear Public Goods Experiments: A Meta-Analysis,” Experimental Economics 6: 299-310.