Decisions from experience: How groups and individuals adapt to change
Whether groups make better judgments and decisions than individuals has been studied extensively, but most of this research has focused on static tasks. How do groups and individuals compare in settings where the decision environment changes unexpectedly and without notification? This article examines group and individual behavior in decisions from experience where the underlying probabilities change after some trials. Consistent with the previous literature, the results showed that groups performed better than the average individual while the decision task was stable. However, group performance was no longer superior after a change in the decision environment. Group performance was closer to the benchmark of Bayesian updating, which assumed perfect memory. Findings suggest that groups did not adopt decision routines that might have delayed their adaption to change in the environment. Rather, they seem to have coordinated their responses, which led them to behave as if they had better memory and subsequently delayed adaptation.
KeywordsGroup versus individual decisions Decisions from experience Uncertainty Changing environments Adaptation Instance-based learning
This research was supported in part by a grant from the Defense Threat Reduction Agency (HDTRA1-09-1-0053) and by National Science Foundation award number 1154012 to Cleotilde Gonzalez. We are grateful for discussions with and comments from Tara Wernsing, Taya Cohen, Tilmann Betsch, and Juliane Kämmer. We thank Hau-yu Wong for research assistance and Susannah Goss for editing the manuscript.
Tomás Lejarraga, Center for Adaptive Rationality, Max Planck Institute for Human Development; José Lejarraga, IE Business School, IE University; Cleotilde Gonzalez, Dynamic Decision Making Laboratory, Department of Social and Decision Sciences, Carnegie Mellon University.
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