DECISION MAKING BY COMMITTES

Decision making by committes



Decision making by committes

Introduction

How do committees work? And how should they be designed? A recent game theoretic literature has added useful insights to the theory of committee decision making. The role of this paper is to provide an overview over the latest developments in this field and to relate it to some current debates on the design of committees for international decision making. (Facione, P. and Facione, N, 2007)

This paper does not aim to provide a comprehensive study of all contributions in this field. It is rather meant to introduce the reader to this branch of literature, to relate different results and to identify important assumptions concerning the study of committees. We focus on the strategic behavior of committee members facing decisions that are made only once and that are irreversible. The formal study of committees is long standing. In his seminal contribution, (Facione, P. and Facione, N, 2007) describes a committee as a mechanism that efficiently aggregates decentralized information. He argues in his famous jury theorem that (i) increasing the number of informed committee members raises the probability that an appropriate decision is made and (ii) the probability of making the appropriate decision will converge to one with the number of committee members going to infinity. (Facione, P. and Facione, N, 2007)

It is useful to relate the modern literature on committees to Condorcet's early insight. Condorcet's analysis is based on a simple setup, where (i) individuals always reveal their signal about the true state of the world, (ii) individuals obtain their signal at zero cost, (iii) all individuals have the same objective: to make a correct decision, and (iv) individuals do not exchange views before voting. In many cases of interest, some (or even all) of these assumptions do not hold. Some voting rules may induce individuals not to vote in accordance with their own information. When information acquisition is costly, individuals provide less effort in large committees. Conflicting interests may lead to the misrepresentation of information. And communication may affect individual voting behavior when information is distributed asymmetrically. Recent papers have therefore addressed the issue of committee decision making when one or more of Condorcet's assumptions do not hold. (Facione, P. and Facione, N, 2007)

Explanation

Framing effects in group decisions

In this paper, we aim to extend the current understanding of framing effects from individual to group decisions, investigating whether groups show the same framing effects as individuals. The few existing studies of framing effects in group decisions have focused on decision outcome as the dependent variable. The results have been mixed and even contradictory. For instance, (Facione, P. and Facione, N, 2007) examined risky choice framing effects among individuals and groups using several scenarios, including a variation of Tversky and (Facione, P. and Facione, N, 2007) Asian disease problem. Participants completed a decision questionnaire individually and then reconsidered the same scenarios in groups, with identical framing. He found the usual gain/loss framing effect for individual decisions and a reduced framing effect for ...