Essays on Experimental Group Dynamics and Competition

William Brown, Purdue University

Abstract

This thesis consists of three chapters. In the first chapter, I investigate the effects of complexity in various voting systems on individual behavior in small group electoral competitions. Using a laboratory experiment, I observe individual behavior within one of three voting systems – plurality, instant runoff voting (IRV), and score then automatic runoff (STAR). I then estimate subjects’ behavior in three different models of bounded rationality. The estimated models are a model of Level-K thinking (Nagel, 1995)[1], the Cognitive Hierarchy (CH) model (Camerer, et al. 2004)[2], and a Quantal Response Equilibrium (QRE) (McKelvey and Palfrey 1995)[3]. I consistently find that more complex voting systems induce lower levels of strategic thinking. This implies that policy makers desiring more sincere voting behavior could potentially achieve this through voting systems with more complex strategy sets. Of the tested behavioral models, Level-K consistently fits observed data the best, implying subjects make decisions that combine of steps of thinking with random, utility maximizing, errors.In the second chapter, I investigate the relationship between the mechanisms used to select leaders and both measures of group performance and leaders’ ethical behavior. Using a laboratory experiment, we measure group performance in a group minimum effort task with a leader selected using one of three mechanisms: random, a competition task, and voting. After the group task, leaders must complete a task that asks them to behave honestly or dishonestly in questions related to the groups performance. We find that leaders have a large impact on group performance when compared to those groups without leaders. Evidence for which selection mechanism performs best in terms of group performance seems mixed. On measures of honesty, the strongest evidence seems to indicate that honesty is most positively impacted through a voting selection mechanism, which differences in ethical behavior between the random and competition selection treatments are negligible.In the third chapter, I provide an investigation into the factors and conditions that drive “free riding” behavior in dynamic innovation contests. Starting from a dynamic innovation contest model from Halac, et al. (2017)[4], I construct a two period dynamic innovation contest game. From there, I provide a theoretical background and derivation of mixed strategies that can be interpreted as an agent’s degree to which they engage in free riding behavior, namely through allowing their opponent to exert effort in order to uncover information about an uncertain state of the world. I show certain conditions must be fulfilled in order to induce free riding in equilibrium, and also analytically show the impact of changing contest prize structures on the degree of free riding. I end this paper with an experimental design to test these various theoretical conclusions in a laboratory setting while also considering the behavioral observations recorded in studies investigating similar contest models and provide a plan to analyze the data collected by this laboratory experiment.

Degree

Ph.D.

Advisors

Roberson, Purdue University.

Subject Area

Ethics|Management|Statistics

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