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Group decisions under ambiguity: Convergence to neutrality

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  • Keck, Steffen
  • Diecidue, Enrico
  • Budescu, David V.

Abstract

This paper focuses on decisions under ambiguity. Participants in a laboratory experiment made decisions in three different settings: (a) individually, (b) individually after discussing the decisions with two others, and (c) in groups of three. We show that groups are more likely to make ambiguity-neutral decisions than individuals, and that individuals make more ambiguity-neutral decisions after discussing the decisions with others. This shift toward higher ambiguity neutrality in groups and after a group discussion is associated with a reduction in the rates of both ambiguity aversion and ambiguity seeking. We suggest that the results might be driven by effective and persuasive communication that takes place in groups.

Suggested Citation

  • Keck, Steffen & Diecidue, Enrico & Budescu, David V., 2014. "Group decisions under ambiguity: Convergence to neutrality," Journal of Economic Behavior & Organization, Elsevier, vol. 103(C), pages 60-71.
    • Handle: RePEc:eee:jeborg:v:103:y:2014:i:c:p:60-71
    DOI: 10.1016/j.jebo.2014.03.026
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    More about this item

    Keywords

    Ambiguity; Group decision making; Imprecision; Risk; Vagueness;
    All these keywords.

    JEL classification:

    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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