Groupthink: Theory and Evidence

ETHZ, Game Theory and Society, July 27-30, 2011

Christopher Baker Harvard University

Hanja Blendin & Gerald Schneider

Universität Konstanz

Motivation Thomas C. Schelling 2006, An

astonishing 60 years: The legacy of Hiroshima [Nobel Prize Lecture]: “The most spectacular event of the past half century is one that did not occur. We have enjoyed 60 years

without nuclear weapons exploded in anger. ...we may come to a new

respect for deterrence”

What is groupthink?

The Decision to Invade Iraq Senator Pat Roberts, Chairman of the U.S. Senate Intelligence Committee, “…the intelligence community was suffering from what we call a collective groupthink”

Source: F. Zagare 2004. Reconciling Rationality with Deterrence. Journal of Theoretical Politics

C=Conceding D=Demand

• Definition of Groupthink: „A mode of thinking that people engage in when they are deeply involved in a cohesive in-group, when the members' strivings for unanimity override their motivation to realistically appraise alternative courses of action.“ (Janis 1972, 9)

• Problems:

Problems - Many citations (>2500), few recent experimental tests - Limited micro-foundations Our approach - Formal model of group- think - Focus on stress and cohesion

Source: Parks (2000)

Antecedents Black box Decision Disaster

Stress

Group cohesion

Deflated self- confidence

Concurrence seeking

Reduced decision quality

The theoretical foundations: an adapted version of the Condorcet Jury Voting

Model Condorcet Jury Theorem: If the probability of “voting” for the right decision exceeds 0.5, then larger groups make a more correct version than smaller ones. Austen-Smith/Banks (1996) and Feddersen/Pesendorfer (1998) show how strategic voting undermines this optimism. We use the latter model to show some conditions under which „irrational believes“ lead to concurrence seeking and poor decisions.

Crisis cabinet of a country (Janistan) has to decide if to escalate in a conflict or not

Correct decision depends on the opponent (Whyteland)

q = members‘ escalation threshold Probability that signal is correct: Probability that signal is wrong:

Pr(si = h H ) = Pr(si = h H ) = c

Pr(si = h H ) = Pr(si = h H ) = 1− c

Outcome(decision = escalate | Whyteland = hostile) = 0O(e | H ) = −qO(e | H ) = 0O(e | H ) = −(1− q)

Assumptions • -1- ministers have identical competence levels • -2- ministers update their beliefs based on information of the others • -3- prime minister casts his/her vote first, the others then simultaneously • -4- prime minister votes informatively, this is common knowledge

Equilibria • unique symmetric response equilibrium: i votes informatively, when

• pessimistic mixed strategy for

• optimistic mixed strategy for

β(k̂ −1,n) ≤ q < β(k̂,n)

0 < σ (si = h ) < σ (si = h) = 1

0 = σ (si = h ) < σ (si = h) < 1

Variation 1: expected competence of leader exceeds actual competence

c1 > ci≠1

Equilibrium ranges between: always copying the prime minister‘s vote and the equilibrium of the base scenario

Variation 2: Ministers are under-confident

c > ci

The smaller ci the more a minister tends to ignore the own signal and to copy the prime minister‘s vote

Experiment • Conducted 2010 in the lakelab of the University

of Konstanz (programmed in z-tree) • 104 subjects of all faculties, mainly males • 2(3) treatments: time pressure, cohesion • 3 dependent variables

- concurrence seeking (change of opinion after decision) - self-confidence after knowledge test - „wrong“ decisions (100 balls in jar, guessing the dominant color)

Of which color are there more balls in the jar?

• Time pressure increases concurrence-seeking • Cohesion (in the form of building team and

participation in rock-scissor game) decreases self-confidence

Table 1: Influence of treatments on concurrence-seeking (CS) and self-confidence (SC) CS (1) CS(2) CS(3) SC (4) SC (5) SC (6)

Time pressure 1.8* (0.78)

3.33* (2.38)

0.61 (0.26)

1.49 (1.29)

Cohesion 1.23 (0.54)

2.14 (1.39)

0.24*** (0.11)

0.44 (0.26)

Cohesion and time pressure

0.38 (0.35)

0.17* (0.17)

Log-Likelihood -62.45 -63.24 -61.66 -67.02 -62.42 -59.42 % correctly predicted 70.19 70.19 70.19 64.42 64.42 72.12 Notes: N=104. Coefficients are odds ratios, standard error in parentheses. * p < 0.10, ** p < 0.05, *** p<0.01

• Time pressure and self-confidence decrease decision making quality

• Cohesion increases quality of decisions Table 2: Influence of treatments, of concurrence seeking and of self-confidence on decisio quality (DQ) (1) ( 2) (3) (4) (5)

Time pressure 0.40** (0.18)

2.05 (1.41)

0.15*** (0.10)

0.06*** (0.05)

Cohesion 1.78 (0.76)

4.64** (2.76)

Cohesion and time pressure

0.04*** (0.05)

Concurrence seeking

0.86 (0.319

0.36 (0.23)

Concurrence seeking and time pressure

13.49** (13.98)

Self-confidence

0.56 (0.24)

0.18*** (0.12)

Self-confidence and time pressure

18.26*** (19.31)

Log-Likelihood -64.90 -66.16 -59.26 -67.03 -61.50 -66.15 -59.21 % correctly predicted 65.38 65.38 69.23 65.38 65.38 65.38 73.08

• BBS version of CJT provides one mechanism through which groupthink and the consequences of groupthink might be explained

• Time pressure increases concurrence-seeking and decreases decision making quality

• Concurrence seeking results more ambiguous: Cohesion increases self-confidence and not confidence in group, increased self-confidence lowers decision making quality

Appendix β(k,n) = ck (1− c)n−k

ck (1− c)n−k + cn−k (1− c)k

i always votes informatively when:

β(k̂ −1,n) ≤ q < β(k̂,n)

Pessimistic mixed strategy

Unique symmetric equilibrium in mixed strategies such that: σ1(h) = σ i≠1(v1 = e, s1 = h) = σ i≠1(v1 = e , s1 = h) = 1

σ1(h ) = σ i≠1(v1 = e, s1 = h ) = σ i≠1(v1 = e , s1 = h ) = v *

The probability that i votes for „escalate“ is between v* and 1

0 < v* =%c(1+ A

1k−1 ) −1

%c − A1

k−1 (1− %c)< 1 , with

A =

(1− q)(1− %c)n− k+1

q%cn− k+1 Pessimistic strategy

(1− %c)n− k̂+1

(1− %c)n− k̂+1 + %cn− k̂+1< q < β(k̂ −1,n)

Mixed strategy

Unique symmetric equilibrium in mixed strategies such that:

The probability that i chooses „escalate“ is between 0 and w*

Optimistic strategy

β(k̂,n) < q <ck

ck + (1− c)k

σ1(h) = σ i≠1(v1 = e, s1 = h) = σ i≠1(v1 = e , s1 = h) = w *

σ1(h ) = σ i≠1(v1 = e, s1 = h ) = σ i≠1(v1 = e , s1 = h ) = 0

0 = σ (si = h ) < σ (si = h) < 1