Group Decisions: Analyzing Decision Strategy and Structure in Households
- Michael W. Hanemann, Goldman School of Public Policy, University of California, Berkeley
- Wiktor Adamowicz, U Alberta
- Joffre Swait, U Alberta & Advanis
- Reed Johnson, Research Triangle Institute, NC
- David Layton, U Washington
- Michel Regenwetter, U Illinois Urbana-Champaign
- Torsten Reimer, Max Planck Institute for Human Development and U Basel
- Robert Sorkin, U Florida
- Goldman School of Public Policy Working Paper (January 2005)
We begin the paper by critically reviewing the unitary model (Vermeulen, 2002), which (1) assumes that a single preference represents all agents in the group, or equivalently, that all agents have identical preferences; (2) imposes the choice of a benevolent dictator on the group; (3) assumes the group’s budget to be a single pooled value; (4) does not allow bargaining or negotiation, (5) nor permits knowledge or experience differences between members to lead to the use of different decision-making strategies. The impact of policies affecting group members differentially, for example, cannot be correctly assessed in the unitary model because its use will lead to erroneous welfare inferences (Vermeulen, 2002). Clearly, the need for alternative models is pressing.
In the remainder of this paper we will synthesize the literature across disciplines with a view towards characterizing the shortcomings of current approaches to modeling group decisions. Subsequently we broach a number of issue areas that we believe future research must address to improve our understanding of group decisions and to enhance our ability to model and predict outcomes from such decisions. We then present a conceptual model of group decisionmaking that arose from our discussions and, we feel, synthesizes the multidisciplinary views represented in the workshop. We conclude by proposing a number of specific research questions 3 that we believe should be addressed in the short term.
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