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Exploring Group Behavior in a Power-to-Take Video Experiment

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Author Info

  • Ronald Bosman
  • Heike Hennig-Schmidt
  • Frans vanWinden

Abstract

This paper experimentally explores group decision-making in a two-player power-to-take game. Discussions preceding group decisions are video taped and analyzed. Each subject first earns an income in an individual effort task preceding the game. The game consists of two stages. First, one group can claim any part of the income of the other group (take rate). Then, the latter group can respond by destroying own income. The results show that (1) although group behavior is in line with individual behavior, group behavior depends crucially on the decision rules that subject use to arrive at their group decision; (2) groups ignore the decision rule of their ‘opponents’ and typically view other groups as if they were single agents; (3) perceptions of fairness are prone to the so-called self-serving bias. (4) expectations are often not consistent with actual outcomes.

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File URL: http://www.wiwi.uni-bonn.de/bgsepapers/bonedp/bgse7_2002.pdf
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Bibliographic Info

Paper provided by University of Bonn, Germany in its series Bonn Econ Discussion Papers with number bgse7_2002.

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Length: 27
Date of creation: Feb 2002
Date of revision: May 2002
Handle: RePEc:bon:bonedp:bgse7_2002

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Postal: Bonn Graduate School of Economics, University of Bonn, Adenauerallee 24 - 26, 53113 Bonn, Germany
Fax: +49 228 73 6884
Web page: http://www.bgse.uni-bonn.de

Related research

Keywords: groups; decision rule; fairness; experiment; video;

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References

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  1. Cason, Timothy N & Mui, Vai-Lam, 1997. "A Laboratory Study of Group Polarisation in the Team Dictator Game," Economic Journal, Royal Economic Society, vol. 107(444), pages 1465-83, September.
  2. Martin G. Kocher & Matthias Sutter, 2005. "The Decision Maker Matters: Individual Versus Group Behaviour in Experimental Beauty-Contest Games," Economic Journal, Royal Economic Society, vol. 115(500), pages 200-223, 01.
  3. Frans van Dijk & Joep Sonnemans & Frans van Winden, 2000. "Incentive Systems in a Real Effort Experiment," CESifo Working Paper Series 272, CESifo Group Munich.
  4. Ernst Fehr & Klaus M. Schmidt, 1999. "A Theory Of Fairness, Competition, And Cooperation," The Quarterly Journal of Economics, MIT Press, vol. 114(3), pages 817-868, August.
  5. Bone, John & Hey, John & Suckling, John, 1999. "Are Groups More (or Less) Consistent Than Individuals?," Journal of Risk and Uncertainty, Springer, vol. 18(1), pages 63-81, April.
  6. Jacobsen, Eva & Abdolkarim Sadrieh, 1996. "Experimental Proof for the Motivational Importance of Reciprocity," Discussion Paper Serie B 386, University of Bonn, Germany.
  7. Rockenbach, Bettina & Sadrieh, Abdolkarim & Mathauschek, Barbara, 2007. "Teams take the better risks," Journal of Economic Behavior & Organization, Elsevier, vol. 63(3), pages 412-422, July.
  8. Heike Hennig-Schmidt, 2000. "The Impact of Fairness on Decision Making - An Analysis of Different Video Experiments," Bonn Econ Discussion Papers bgse14_2001, University of Bonn, Germany, revised Feb 2002.
  9. Gary Bornstein & Ilan Yaniv, 1998. "Individual and Group Behavior in the Ultimatum Game: Are Groups More “Rational†Players?," Experimental Economics, Springer, vol. 1(1), pages 101-108, June.
  10. Robert, Christopher & Carnevale, Peter J., 1997. "Group Choice in Ultimatum Bargaining," Organizational Behavior and Human Decision Processes, Elsevier, vol. 72(2), pages 256-279, November.
  11. Loomes, Graham, 1999. "Some Lessons from Past Experiments and Some Challenges for the Future," Economic Journal, Royal Economic Society, vol. 109(453), pages F35-45, February.
  12. Messick, David M. & Moore, Don A. & Bazerman, Max H., 1997. "Ultimatum Bargaining with a Group: Underestimating the Importance of the Decision Rule," Organizational Behavior and Human Decision Processes, Elsevier, vol. 69(2), pages 87-101, February.
  13. Michael R. Ransom & Gordon B. Dahl, 1999. "Does Where You Stand Depend on Where You Sit? Tithing Donations and Self-Serving Beliefs," American Economic Review, American Economic Association, vol. 89(4), pages 703-727, September.
  14. Ronald Bosman & Frans van Winden, 2002. "Emotional Hazard in a Power-to-take Experiment," Economic Journal, Royal Economic Society, vol. 112(476), pages 147-169, January.
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Citations

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Cited by:
  1. Kocher, Martin G. & Sutter, Matthias, 2007. "Individual versus group behavior and the role of the decision making procedure in gift-exchange experiments," Munich Reprints in Economics 18214, University of Munich, Department of Economics.
  2. Sadiraj, V. & Tuinstra, J. & Winden, F. van, 2004. "Interest Group Size Dynamics and Policymaking (extensive revised version of WP 01-03)," CeNDEF Working Papers 04-06, Universiteit van Amsterdam, Center for Nonlinear Dynamics in Economics and Finance.
  3. Martin Angerer & Juergen Huber & Martin Shubik & Shyam Sunder, 2010. "An economy with personal currency: theory and experimental evidence," Annals of Finance, Springer, vol. 6(4), pages 475-509, October.
  4. Vjollca Sadiraj & Jan Tuinstra & Frans Winden, 2005. "Interest group size dynamics and policymaking," Public Choice, Springer, vol. 125(3), pages 271-303, December.
  5. Simon Halliday, 2011. "Rarer Actions: Giving and Taking in Third-Party Punishment Games," SALDRU Working Papers 62, Southern Africa Labour and Development Research Unit, University of Cape Town.
  6. Alexander Elbittar & Andrei Gomberg & Laura Sour, 2004. "Group Decision-Making in Ultimatum Bargaining: An Experimental Study," Working Papers 0407, Centro de Investigacion Economica, ITAM.
  7. Müller, Wieland & Tan, Fangfang, 2013. "Who acts more like a game theorist? Group and individual play in a sequential market game and the effect of the time horizon," Games and Economic Behavior, Elsevier, vol. 82(C), pages 658-674.

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