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dc.contributor.authorCheung, Stephen L.
dc.contributor.authorPalan, Stefan
dc.date.accessioned2011-09-15
dc.date.available2011-09-15
dc.date.issued2011-09-01
dc.identifier.urihttp://hdl.handle.net/2123/7778
dc.description.abstractIn the world of mutual funds management, responsibility for investment decisions is increasingly entrusted to small teams instead of individuals. Yet the effect of team decision-making in a market environment has never been studied in a controlled experiment. In this paper, we investigate the effect of team decision-making in an asset market experiment that has long been known to reliably generate price bubbles and crashes in markets populated by individuals. We find that this tendency is substantially reduced when each decision-making unit is instead a team of two. This holds across a broad spectrum of measures of the severity of mispricing, both under a continuous double-auction institution and in a call market. The result is not driven by reduced turnover due to time required for deliberation by teams, and continues to hold even when subjects are experienced. Our result also holds not only when our teams treatments are compared to the ‘narrow’ baseline provided by the corresponding individuals treatments, but also when compared more broadly to the results of the large body of previous research on markets of this kind.en_AU
dc.language.isoen_AUen_AU
dc.publisherSchool of Economicsen_AU
dc.relation.ispartofseries2011-08
dc.subjectgroup decision-makingen_AU
dc.subjectprice bubblesen_AU
dc.subjectasset market experimentsen_AU
dc.titleTwo heads are less bubbly than one: Team decision-making in an experimental asset marketen_AU
dc.typeWorking Paperen_AU
dc.contributor.departmentSchool of Economicsen_AU


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