Title

Collective experimentation: A laboratory study

Abstract

We develop a simple model of collective experimentation and take it to the lab. In equilibrium, as in the recent work of Strulovici (2010), majority rule has a bias toward under-experimentation, as good news for a minority of voters may lead a majority of voters to abandon a policy when each of them thinks it is likely that the policy will be passed by a future majority excluding them. We compare the behavior in the lab of groups under majority rule and under the optimal voting rule, which precludes voting in intermediate stages of the policy experiment. Surprisingly, simple majority performs better than the (theoretically) optimal voting rule. Majority rule seems to lead to better outcomes than other forms of voting when players make mistakes.

Department(s)

Economics

Document Type

Article

DOI

https://doi.org/10.1016/j.jebo.2019.08.011

Keywords

Collective experimentation, Over-optimism, Strategic voting

Publication Date

7-1-2020

Journal Title

Journal of Economic Behavior and Organization

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