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  The Intrinsic Value of Decision Rights: A Note on Team vs Individual Decision-Making

Buffat, J., Praxmarer, M., & Sutter, M. (2020). The Intrinsic Value of Decision Rights: A Note on Team vs Individual Decision-Making.

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 Creators:
Buffat, J., Author
Praxmarer, Matthias1, Author              
Sutter, Matthias1, Author              
Affiliations:
1Max Planck Institute for Research on Collective Goods, Max Planck Society, ou_2173688              

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Free keywords: Decision rights, intrinsic value, team decision making, experiment
 JEL: C92 - Laboratory, Group Behavior
 JEL: D23 - Organizational Behavior; Transaction Costs; Property Rights
 JEL: D80 - General
 Abstract: Team decision-making prevails in modern organizations. Teams often need to decide whether to delegate or make a decision themselves. Recent work has found that many individuals assign a significantly positive intrinsic value to having a decision right, which may distort the choice between delegating a decision or not. Here we examine experimentally whether teams are also prone to such distortions. While in the aggregate we find no differences between individuals and teams, we uncover an important heterogeneity within teams. Teams with a smooth decision making process have much lower intrinsic values of decision rights than individuals, often not even significantly different from zero. Yet, teams with conflicts in reaching a decision have very high intrinsic values of decision rights, thus distorting decisions. Hence, the team decision making process is of significant importance for the decision-making quality in organizations.

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 Dates: 2020-12-14
 Publication Status: Published online
 Pages: -
 Publishing info: Bonn : Max Planck Institute for Research on Collective Goods, Discussion Paper 2020/30
 Table of Contents: -
 Rev. Type: -
 Identifiers: Other: 2020/30
 Degree: -

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