Unethical Decisions and Coordination in Groups: The Role of Information and Communication

Using a behavioral game-theoretical model and an experiment we study how information and communication influence coordination in groups when they can misreport the outcome of a binary lottery. Both group members receive a positive payoff only if their reports match. Consistent with our theory, nearly all groups coordinate when allowed to communicate prior to submitting their individual reports. The extent of coordination on either truth-telling or lying is correlated with the individual lying costs. Overall, both information and communication promote coordination on more dishonesty. These findings underscore how information and communication can increase coordination and dishonesty depending on intrinsic lying-aversion.