Too Good to Be True – Individual and Collective Decision-Making with Misleading Signals

References

• Andreoni J, Mylovanov T (2012) Diverging opinions. Amer. Econom. J. Microeconomics 4(1):209–232.Crossref, Google Scholar
• Austen-Smith D, Feddersen TJ (2006) Deliberation, preference uncertainty, and voting rules. Amer. Political Sci. Rev. 100(2):209–217.Crossref, Google Scholar
• Austen-Smith D, Feddersen TJ (2009) Information aggregation and communication in committees. Philos. Trans. Roy. Soc. London B: Biol. Sci. 364(1518):763–769.Crossref, Google Scholar
• Bohren JA (2016) Informational herding with model misspecification. J. Econom. Theory 163:222–247.Crossref, Google Scholar
• Bouton L, Castanheira M, Llorente-Saguer A (2016) Divided majority and information aggregation: Theory and experiment. J. Public Econom. 134:114–128.Crossref, Google Scholar
• Bouton L, Llorente-Saguer A, Malherbe F (2018) Get rid of unanimity rule: The superiority of majority rules with veto power. J. Political Econom. 126(1):107–149.Crossref, Google Scholar
• Brandts J, Giritligil AE, Weber RA (2015) An experimental study of persuasion bias and social influence in networks. Eur. Econom. Rev. 80:214–229.Crossref, Google Scholar
• Breitmoser Y, Valasek J (2024a) Strategic communication in committees with expressive payoffs. RAND J. Econom. 55(1):33–54.Crossref, Google Scholar
• Breitmoser Y, Valasek J (2024b) Why do committees work? NHH Department of Economics Discussion paper, Norwegian School of Economics, Bergen, Norway.Google Scholar
• Cason TN, Sharma T, Vadovič R (2020) Correlated beliefs: Predicting outcomes in 2 × 2 games. Games Econom. Behav. 122:256–276.Crossref, Google Scholar
• Chandrasekhar AG, Larreguy H, Xandri JP (2020) Testing models of social learning on networks: Evidence from two experiments. Econometrica 88(1):1–32.Crossref, Google Scholar
• Collinger T (2016) You don’t want a 5-star review. Northwestern (January 4), https://news.northwestern.edu/stories/2016/01/opinion-techcrunch-reviews.Google Scholar
• Coughlan PJ (2000) In defense of unanimous jury verdicts: Mistrials, communication, and strategic voting. Amer. Political Sci. Rev. 94(02):375–393.Crossref, Google Scholar
• Currarini S, Ursino G, Chand AK (2020) Strategic transmission of correlated information. Econom. J. 130(631):2175–2206.Google Scholar
• Dasaratha K, He K (2020) Network structure and naive sequential learning. Theoret. Econom. 15(2):415–444.Crossref, Google Scholar
• Demange G (2018) Contagion in financial networks: A threat index. Management Sci. 64(2):955–970.Link, Google Scholar
• DeMarzo PM, Vayanos D, Zwiebel J (2003) Persuasion bias, social influence, and unidimensional opinions. Quart. J. Econom. 118(3):909–968.Crossref, Google Scholar
• Denter P, Dumav M, Ginzburg B (2021) Social connectivity, media bias, and correlation neglect. Econom. J. 131(637):2033–2057.Google Scholar
• Ellis A, Piccione M (2017) Correlation misperception in choice. Amer. Econom. Rev. 107(4):1264–1292.Crossref, Google Scholar
• Enke B, Zimmermann F (2019) Correlation neglect in belief formation. Rev. Econom. Stud. 86(1):313–332.Google Scholar
• Epstein I, Slotki JJ (1961) The Babylonian Talmud: Seder Nezikin, vol. 13 (Soncino Press, London).Google Scholar
• Eyster E, Rabin M (2010) Naive herding in rich-information settings. Amer. Econom. J. Microeconomics 2(4):221–243.Crossref, Google Scholar
• Eyster E, Rabin M (2014) Extensive imitation is irrational and harmful. Quart. J. Econom. 129(4):1861–1898.Crossref, Google Scholar
• Eyster E, Weizsäcker G (2016) Correlation neglect in portfolio choice: Lab evidence. Preprint, submitted October 28, https://doi.org/10.2139/ssrn.2914526.Google Scholar
• Falk A, Becker A, Dohmen T, Huffman D, Sunde U (2023) The preference survey module: A validated instrument for measuring risk, time, and social preferences. Management Sci. 69(4):1935–1950.Link, Google Scholar
• Feddersen T, Gradwohl R (2020) Decentralized advice. Eur. J. Political Econom. 63:101871.Crossref, Google Scholar
• Feddersen T, Pesendorfer W (1998) Convicting the innocent: The inferiority of unanimous jury verdicts under strategic voting. Amer. Political Sci. Rev. 92(01):23–35.Crossref, Google Scholar
• Fehrler S, Hahn V (2023) Committee decision-making under the threat of leaks. J. Politics 85(3):1107–1122.Crossref, Google Scholar
• Fehrler S, Hughes N (2018) How transparency kills information aggregation: Theory and experiment. Amer. Econom. J. Microeconomics 10(1):181–209.Crossref, Google Scholar
• Fehrler S, Janas M (2021) Delegation to a group. Management Sci. 67(6):3714–3743.Link, Google Scholar
• Frederick S (2005) Cognitive reflection and decision making. J. Econom. Perspect. 19(4):25–42.Crossref, Google Scholar
• Gagnon-Bartsch T, Rabin M (2022) Naive social learning, mislearning, and unlearning. Working paper, Harvard University Cambridge, MA.Google Scholar
• Gerardi D, Yariv L (2007) Deliberative voting. J. Econom. Theory 134(1):317–338.Crossref, Google Scholar
• Giamattei M, Yahosseini KS, Gächter S, Molleman L (2020) Lioness lab: A free web-based platform for conducting interactive experiments online. J. Econom. Sci. Assoc. 6(1):95–111.Crossref, Google Scholar
• Glaeser EL, Sunstein CR (2009) Extremism and social learning. J. Legal Anal. (Oxford) 1(1):263–324.Crossref, Google Scholar
• Goeree JK, Yariv L (2011) An experimental study of collective deliberation. Econometrica 79(3):893–921.Crossref, Google Scholar
• Golub B, Jackson MO (2010) Naive learning in social networks and the wisdom of crowds. Amer. Econom. J Microeconomics 2(1):112–149.Crossref, Google Scholar
• Guarnaschelli S, McKelvey RD, Palfrey TR (2000) An experimental study of jury decision rules. Amer. Political Sci. Rev. 94(2):407–423.Crossref, Google Scholar
• Gubaydullina Z, Spiwoks M (2015) Correlation neglect, naïve diversification, and irrelevant information as stumbling blocks for optimal diversification. J. Finance Investment Anal. (Oxford) 4(2):1–19.Google Scholar
• Gunn LJ, Chapeau-Blondeau F, McDonnell MD, Davis BR, Allison A, Abbott D (2016) Too good to be true: When overwhelming evidence fails to convince. Proc. Roy. Soc. A: Math. Physical Engrg. Sci. 472(2187):20150748.Google Scholar
• Hansen S, McMahon M, Prat A (2018) Transparency and deliberation within the FOMC: A computational linguistics approach. Quart. J. Econom. 133(2):801–870.Crossref, Google Scholar
• Hedesström TM, Svedsäter H, Gärling T (2006) Covariation neglect among novice investors. J. Experiment. Psych. Appl. 12(3):155–165.Crossref, Google Scholar
• Hossain T, Okui R (2024) Belief formation under signal correlation. Games Econom. Behav. 146:160–183.Crossref, Google Scholar
• Hughes N, Khan ZU, Mengel F (2023) Diversity in committees. Preprint, submitted June 29, https://doi.org/10.2139/ssrn.4495035.Google Scholar
• Kallir I, Sonsino D (2009) The neglect of correlation in allocation decisions. Southern Econom. J. 75(4):1045–1066.Crossref, Google Scholar
• Keren G, Lewis C (1994) The two fallacies of gamblers: Type I and type II. Organ. Behav. Human Decision Processes 60(1):75–89.Crossref, Google Scholar
• Kremer M, Siemsen E, Thomas DJ (2016) The sum and its parts: Judgmental hierarchical forecasting. Management Sci. 62(9):2745–2764.Link, Google Scholar
• Laudenbach C, Ungeheuer M, Weber M (2023) How to alleviate correlation neglect in investment decisions. Management Sci. 69(6):3400–3414.Link, Google Scholar
• Le Quement MT, Marcin I (2020) Communication and voting in heterogeneous committees: An experimental study. J. Econom. Behav. Organ. 174:449–468.Crossref, Google Scholar
• Le Quement MT, Yokeeswaran V (2015) Subgroup deliberation and voting. Soc. Choice Welfare 45(1):155–186.Crossref, Google Scholar
• Levy G, Razin R (2015) Correlation neglect, voting behavior, and information aggregation. Amer. Econom. Rev. 105(4):1634–1645.Crossref, Google Scholar
• Levy G, Razin R (2022) Combining forecasts in the presence of ambiguity over correlation structures. J. Econom. Theory 199:105075.Crossref, Google Scholar
• Levy G, de Barreda IM, Razin R (2022) Persuasion with correlation neglect: A full manipulation result. Amer. Econom. Rev. Insights 4(1):123–138.Crossref, Google Scholar
• Lightle JP, Kagel JH, Arkes HR (2009) Information exchange in group decision making: The hidden profile problem reconsidered. Management Sci. 55(4):568–581.Link, Google Scholar
• Luca M, Zervas G (2016) Fake it till you make it: Reputation, competition, and yelp review fraud. Management Sci. 62(12):3412–3427.Link, Google Scholar
• Maslowska E, Malthouse EC, Bernritter SF (2017) Too good to be true: The role of online reviews’ features in probability to buy. Internat. J. Advert. 36(1):142–163.Crossref, Google Scholar
• Mattozzi A, Nakaguma MY (2023) Public versus secret voting in committees. J. Eur. Econom. Assoc. 21(3):907–940.Crossref, Google Scholar
• Mayzlin D, Dover Y, Chevalier J (2014) Promotional reviews: An empirical investigation of online review manipulation. Amer. Econom. Rev. 104(8):2421–2455.Crossref, Google Scholar
• Monteiro S, Sutter M, Praxmarer M (2022) Correlation neglect in belief formation: Team versus individual decision-making. PhD dissertation chapter, University of Cologne, Köln, Germany.Google Scholar
• Moore DA, Healy PJ (2008) The trouble with overconfidence. Psych. Rev. 115(2):502–517.Crossref, Google Scholar
• Moser J, Wallmeier N (2021) Correlation neglect in voting decisions: An experiment. Econom. Lett. 198:109656.Crossref, Google Scholar
• Ortoleva P, Snowberg E (2015) Overconfidence in political behavior. Amer. Econom. Rev. 105(2):504–535.Crossref, Google Scholar
• Palan S, Schitter C (2018) Prolific.ac—A subject pool for online experiments. J. Behav. Experiment. Finance 17:22–27.Crossref, Google Scholar
• Rabin M, Schrag JL (1999) First impressions matter: A model of confirmatory bias. Quart. J. Econom. 114(1):37–82.Crossref, Google Scholar
• Renes S, Visser B (2024) Strategic expert committees and the markets that assess them: A laboratory experiment. Management Sci. 71(7):6227–6247.Link, Google Scholar
• Skillings J (2022) When is 4.8 greater than 5.0? The world of fake reviews. YouCanBeFound (November 9), https://www.youcanbefound.com/when-is-4-8-greater-than-5-0-the-world-of-fake-reviews/.Google Scholar
• Smirnov A, Starkov E (2022) Bad news turned good: Reversal under censorship. Amer. Econom. J. Microeconomics 14(2):506–560.Crossref, Google Scholar
• Sohrab SG, Waller MJ, Kaplan S (2015) Exploring the hidden-profile paradigm: A literature review and analysis. Small Group Res. 46(5):489–535.Crossref, Google Scholar
• Spiwoks M, Bizer K (2018) Correlation neglect and overconfidence an experimental study. J. Appl. Finance Banking 8(3):75–86.Google Scholar
• Stanovich KE, West RF (1997) Reasoning independently of prior belief and individual differences in actively open-minded thinking. J. Ed. Psych. 89(2):342–357.Crossref, Google Scholar
• Stasser G, Titus W (1985) Pooling of unshared information in group decision making: Biased information sampling during discussion. J. Personality Soc. Psych. 48(6):1467–1478.Crossref, Google Scholar
• Toplak ME, West RF, Stanovich KE (2011) The Cognitive Reflection Test as a predictor of performance on heuristics-and-biases tasks. Memory Cognition 39(7):1275–1289.Crossref, Google Scholar
• Young HP (1988) Condorcet’s theory of voting. Amer. Political Sci. Rev. 82(4):1231–1244.Crossref, Google Scholar