Too good to be True – Individual and Collective Decision-Making with Misleading Signals
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Series
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Speaker(s)Sebastian Fehrler (University of Bremen, Germany)
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FieldBehavioral Economics
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LocationUniversity of Amsterdam, Roeterseilandcampus, room E0.04
Amsterdam -
Date and time
February 13, 2025
16:00 - 17:15
Abstract
In today's world, there are many cases, where overwhelming evidence, such as fabricated customer reviews, can result in deceptive conclusions. We experimentally investigate individual and collective decision-making within information structures with correlated signals in one state of the world, where too much evidence has the potential to mislead, necessitating a level of sophistication for rational decision-making. Overall, participants' performance is poor with only small differences in collective and individual decision-making accuracy. Interestingly, the more complex environment tends to encourage greater honesty within heterogeneous groups, as compared to the benchmark setting with independent signals, thus validating a rather subtle game-theoretic prediction.