Risk preference differentials of small groups and individuals
This research compares lottery valuation decisions made by individuals with similar decisions made by small groups. There is an extensive social psychology literature addressing group versus individual decision making but few studies explore this issue in economic contexts with cash rewards. Willingness-to-pay data elicited from independent samples of individuals and three-person groups in a repeated-measures experimental design reveal that: the variance of risk preferences is generally smaller for groups than individuals and the average group is "more" risk averse than the average individual in high-risk situations, but groups tend to be "less" risk averse in low-risk situations. Copyright 2008 The Author(s). Journal compilation Royal Economic Society 2008.
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Volume (Year): 118 (2008)
Issue (Month): 525 (01)
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References listed on IDEAS
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- Gary Bornstein & Ilan Yaniv, 1998. "Individual and Group Behavior in the Ultimatum Game: Are Groups More â€œRationalâ€ Players?," Experimental Economics, Springer, vol. 1(1), pages 101-108, June.
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- 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.
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