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Identifier to cite or link to this item: https://hdl.handle.net/10086/27755

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Title
Is Diversity in Capabilities Desirable When Adding Decision Makers?
Creator
Creator Name
BEN-YASHAR, Ruth BEN-YASHAR, Ruth
Creator Name
NITZAN, Shmuel NITZAN, Shmuel
Editor
Contributor Name
Hitotsubashi Institute for Advanced Study, Hitotsubashi University
Key Word
decisional capabilities
group extension
asymmetry
homogeneity
diversity
mean preservation
JEL
D81
Abstract
When the benefit of making a correct decision is sufficiently high, even a slight increase in the probability of making such a decision justifies an increase in the number of decision makers. Applying a standard uncertain dichotomous choice benchmark setting, this study focuses on the relative desirability of two alternatives: adding individuals with capabilities identical to the existing ones and adding identical individuals with mean-preserving capabilities that depend on the states of nature. Our main result establishes that when the group applies the simple majority rule, variability in the capabilities of the new decision makers under the two states of nature, which is commonly observed in various decision-making settings, is less desirable in terms of the probability of making the correct decision.
Publisher
Hitotsubashi Institute for Advanced Study, Hitotsubashi University
Issued Date
2016-03-16
Language
English(eng)
Resource Type
technical report
Version Type
VoR
Is Part OfRelation -
Related Title
Discussion paper series ; No. HIAS-E-21
Physical Description
10 p.
Appears in Collections
Discussion paper series / Hitotsubashi Institute for Advanced Study, Hitotsubashi University
URL
https://hdl.handle.net/10086/27755