Academic journal article Memory & Cognition

Decisions from Experience: How Groups and Individuals Adapt to Change

Academic journal article Memory & Cognition

Decisions from Experience: How Groups and Individuals Adapt to Change

Article excerpt

Published online: 8 August 2014

© Psychonomic Society, Inc. 2014

Abstract Whether groups make better judgments and decisions than individuals has been studied extensively, but most of this research has focused on static tasks. How do groups and individuals compare in settings where the decision environment changes unexpectedly and without notification? This article examines group and individual behavior in decisions from experience where the underlying probabilities change after some trials. Consistent with the previous literature, the results showed that groups performed better than the average individual while the decision task was stable. However, group performance was no longer superior after a change in the decision environment. Group performance was closer to the benchmark of Bayesian updating, which assumed perfect memory. Findings suggest that groups did not adopt decision routines that might have delayed their adaption to change in the environment. Rather, they seem to have coordinated their responses, which led them to behave as if they had better memory and subsequently delayed adaptation.

Keywords Group versus individual decisions . Decisions from experience . Uncertainty . Changing environments . Adaptation . Instance-based learning

(ProQuest: ... denotes formulae omitted.)

Every morning, Ferran Adrià receives fresh products from his suppliers on Spain's Costa Brava. High-quality raw ingredients are crucial to the success of El Bulli, once ranked as the world's best restaurant. Adrià monitors the quality of his suppliers on a daily basis and makes decisions about which suppliers to keep and which to change according to the quality of the goods they provide. Although the quality of the products fluctuates-after all, it depends on random factors like the weather-a sustained drop in quality must be detected and acted upon quickly. Given the importance of this task for El Bulli, would the restaurant benefit from having a group, instead of a single individual, involved in this decision? Perhaps. Only a few kilometers from El Bulli, Joan, Josep, and Jordi Roca manage El Celler de Can Roca, currently considered the best restaurant in the world ("The World's 50 Best Restaurants," 2013).

Whether groups make better judgments and decisions than individuals has been studied extensively. The common observation is that groups perform better than the average individual in a variety of intellective tasks (Hill, 1982). This consistent result is believed to occur because groups have higher information-processing capacity: Groups are able to gather more information (Cohen & Thompson, 2011), make fewer mistakes in processing it (Charness & Sutter, 2012), and use it more consistently than individuals (Hinsz, Tindale, & Vollrath, 1997). Although past research has made substantial progress in understanding how group and individual behavior compare, most of this research has focused on behavior in static environments, and little is known about their relative performance in settings where the decision environment changes unexpectedly and without notification.

Coordinating different opinions within a group is costly and often detrimental to group performance (Steiner, 1972). When decisions are recurrent, however, group members are able to develop routines that allow them to evade a costly coordinated response (Gersick & Hackman, 1990). A routine is a learned behavioral solution that comes to mind first when a familiar decision situation is encountered (Betsch, 2005). Routines can, however, become detrimental if the decision environment changes, because new decision situations may need new solutions. A routine developed under particular conditions may not produce an adequate response under different conditions (Betsch, Haberstroh, & Höhle, 2002). For example, a restaurateur who chooses his suppliers on the basis of long-term reputation (i.e., a routine) may overlook a new, high-quality supplier. …

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