On the relationship between individual and group decisions
Each member of a group receives a signal about the unknown state of the world and decides upon a utility-maximizing recommendation on the basis of that signal. The individuals have identical preferences. The group makes a decision that maximizes the common utility function assuming perfect pooling of the information in individual signals. An action profile is a group action and a recommendation from each individual. A collection of action profiles is rational if there exists an information structure under which all elements in the collection arise with positive probability. With no restrictions on the information structure, essentially all action profiles are rational. In fact, given any distribution over action profiles it is possible to find an information structure that approximates the distribution. In a monotone environment in which individuals receive conditionally independent signals, essentially any single action profile is rational, although some collections of action profiles are not.
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Börgers, Tilman & Hernando-Veciana, Angel & Krähmer, Daniel, 2013.
"When are signals complements or substitutes?,"
Journal of Economic Theory,
Elsevier, vol. 148(1), pages 165-195.
- Börgers, Tilman & Hernando-Veciana, Angel & Krähmer, Daniel, 2010. "When are Signals Complements or Substitutes?," MPRA Paper 29124, University Library of Munich, Germany.
- Hernando-Veciana, Ángel & Krähmer, Daniel & Börgers, Tilman, 2007. "When are signals complements or substitutes?," UC3M Working papers. Economics we072111, Universidad Carlos III de Madrid. Departamento de Economía.
- Tilman Borgers & Angel Hernanco-Veciana & Daniel Krohmer, 2010. "When are Signals Complements or Substitutes," Discussion Papers 1488, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Jonathan Levin & Susan Athey, 2001.
"The Value of Information in Monotone Decision Problems,"
01003, Stanford University, Department of Economics.
- Susan Athey & Jonathan Levin, 1998. "The Value of Information In Monotone Decision Problems," Working papers 98-24, Massachusetts Institute of Technology (MIT), Department of Economics.
- Robert L. Winkler, 1986. "Expert Resolution," Management Science, INFORMS, vol. 32(3), pages 298-303, March.
- Christopher Chambers & Paul Healy, 2012. "Updating toward the signal," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 50(3), pages 765-786, August.
- Kfir Eliaz & Debraj Ray & Ronny Razin, 2006. "Choice Shifts in Groups: A Decision-Theoretic Basis," American Economic Review, American Economic Association, vol. 96(4), pages 1321-1332, September.
- Paul Milgrom & Robert J. Weber, 1981.
"A Theory of Auctions and Competitive Bidding,"
447R, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Robert T. Clemen & Robert L. Winkler, 1990. "Unanimity and Compromise Among Probability Forecasters," Management Science, INFORMS, vol. 36(7), pages 767-779, July.
When requesting a correction, please mention this item's handle: RePEc:the:publsh:1185. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Martin J. Osborne)
If references are entirely missing, you can add them using this form.