welcome to this experiment on decision making centre for ecological and evolutionary studies dept....

Welcome to this experiment on decision making

Centre for Ecological and Evolutionary Studies

dept. of Theoretical Biology

General overview

• Instructions (ca. 15 minutes)• Receiving desk number• Going to lab• Experiment (max. 120 minutes)• Payment (outside laboratory)

• Earnings: 30 +/- 30 Euros

General overview

• Instructions (ca. 15 minutes)• Receiving desk number• Going to lab• Experiment (max. 120 minutes)• Payment (outside laboratory)

• Earnings: 30 +/- 30 Euros

In the lab…

• Instructions are on your desk• Quiz• Experiment itself• Questionnaire• Payment (outside of the lab…)

The experiment

• Do not talk inside the laboratory• You will earn money depending on your decisions

and the decisions of others• You get a show-up fee of XXX Euros• Payments are anonymous• You start out with XXX points• 10 points are worth 1 Euro

The experiment

• Lasts for 10 periods• Each period you will be part of a group

• Randomly assigned• Anonymous• You get a ‘symbol’

•#, $, %, etc

Interacting in your group

• ‘Contribution game’• At least 1 round• New round will start with a 80% chance• Period ends with a 20% chance• Initially, your group will consist of 3 players

The contribution game

• Each round, you can contribute to a project• Costs: 4 points

• Contributions are made simultaneously• The revenues of the project are the sum of the

group’s investments x 1.5• Equally split among the group members

• Both contributors and non-contibutors

The contribution game: example I

• Example 1: all three group members contribute • Cost per player = 4 points

• Total contributions to the project• 3 x 4 = 12 points

• Project’s revenue• 12 x 1.5 = 18 points

• All group members get 6 points• Earnings in this round: 2 points for all group

members

The contribution game: example II

• Other group members contribute, you do NOT contribute • Cost for you = 0 points

• Total contributions to the project• 2 x 4 = 8 points

• Project’s revenue• 8 x 1.5 = 12 points

• Your group-mates earn 0 points• You earn in this round: 3 points

Hiring a ‘supervisor’

• Before the contribution game starts• Your group can decide to hire a supervisor

• Rigorous supervisor• Lenient supervisor• No supervisor

• Supervisor is hired for 1 period• Supervisor is a computer program

Hiring a ‘supervisor’

• Each round of the period that the supervisor is hired

• Non-contributors will NOT get revenues with chance• Rigorous supervisor 100%• Lenient supervisor 50%• No supervisor 0%

• Supervisor is hired for 1 period

Hiring a ‘supervisor’

• Each round of the period that the supervisor is hired

• Non-contributors will NOT get revenues with chance• Rigorous supervisor 100% cost: 2 points• Lenient supervisor 50% cost: 1 point• No supervisor 0% cost: 0 points

• Each round of that period, all group members have costs for the supervision

Hiring a ‘supervisor’

• Which supervisor is hired, depends on majority voting

• Before voting, you can discuss which supervisor to hire in a chat box

• If none of the options gets the majority, the computer program will select a random option

Hiring a ‘supervisor’: example

• You are in a group with 2 others• You hired a ‘lenient supervisor’ for this period

• Cost: 1 point per player per round • One of your group-mates (‘#’) contributes• The other (‘$’) does not contribute

• What are the earnings of the players in this round if you do (not) contribute?

Hiring a ‘supervisor’: example

• What are the earnings of the players in this round if you do (not) contribute?

Your decision

Total amount invested

Project revenue

Your earnings

Earnings of ‘#’

Earnings of ‘$’

Contribute 8 (2x4)

12 (8x1.5)

–1(12/3 – 4 – 1)

–1 (12/3–4–1)

3 or –1(12/3–1) or (12/3

– 1 – 12/3)

Do not contribute

4(1x4)

6(4 x 1.5)

1 or –1(6/3–1) or (6/3 –

1 – 6/3)

–1 (6/3-4-1)

1 or –1(6/3–1) or (6/3 –

1 – 6/3)

50-50 chance

Recapitulation

• As far as we have seen, a period looks like this:1. Chatting2. Voting for hiring a supervisor3. Playing the ‘contribution game’ for a number

of rounds• The number of rounds per period

is equal for all groups

Group growth, splitting and elimination

• At the end of each period, average earnings of the groups are compared

Group growth, splitting and elimination

• At the end of each period, average earnings of the groups are compared

• One group will have the highest average

Group growth, splitting and elimination

• At the end of each period, average earnings of the groups are compared

• This group will grow, two participants are added to this group

Group growth, splitting and elimination

• At the end of each period, average earnings of the groups are compared

• The next period will start, one group being larger

Group growth, splitting and elimination

• After a number of growth events, it may occur that a group of 5 players has the highest average earnings

Group growth, splitting and elimination

• After a number of growth events, it may occur that a group of 5 players has the highest average earnings

• In this case, the group with the lowest average earnings will be eliminated

Group growth, splitting and elimination

• After a number of growth events, it may occur that a group of 5 players has the highest average earnings

• In this case, the group with the lowest average earnings will be eliminated

•Questionnaire

•Payment

Group growth, splitting and elimination

• After a number of growth events, it may occur that a group of 5 players has the highest average earnings

• One participant is added to the this group

Group growth, splitting and elimination

• After a number of growth events, it may occur that a group of 5 players has the highest average earnings

• The group splits in two

Group growth, splitting and elimination

• After a number of growth events, it may occur that a group of 5 players has the highest average earnings

• A new period starts

Summary of a period

1. Hiring a supervisor

2. Playing contribution game

(a number of times)

3. Growth, splitting and elimination of

groups

• In total, the session will last for 10 periods

Session end: questionnaire & payment

• After 10 periods, the experiment ends• You are asked to fill out a few questions about

your personal background• Please remain seated until your desk number

is called• You will be paid in cash individually and

anonymously

Questions ?