Committees Versus Individuals: An Experimental Analysis of Monetary Policy Decision Making

Clare Lombardelli, James Proudman and James Talbot

MPRA Paper from University Library of Munich, Germany

Abstract: We report the results of an experimental analysis of monetary policy decision making under uncertainty. A large sample of economics students played a simple monetary policy game, both as individuals and in committees of five players. Our findings - that groups make better decisions than individuals - accord with previous work by Blinder and Morgan. We also attempt to establish why this is so. Some of the improvement is related to the ability of committees to strip out the effect of bad play, but there is a significant additional improvement, which we associate with players learning from each other’s interest rate decisions.

Keywords: Monetary policy; experimental economics; central banking; uncertainty (search for similar items in EconPapers)
JEL-codes: G0 G00 (search for similar items in EconPapers)
Date: 2005-02-08
New Economics Papers: this item is included in nep-cba, nep-cbe, nep-cdm, nep-exp, nep-mac, nep-mon and nep-pol
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Citations: View citations in EconPapers (86)

Published in International Journal of Central Banking Number 1.Volume(2005): pp. 181-205

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Related works:
Journal Article: Committees Versus Individuals: An Experimental Analysis of Monetary Policy Decision-Making (2005)
Working Paper: Committees versus individuals: an experimental analysis of monetary policy decision-making (2003)
Working Paper: Committees versus individuals: an experimental analysis of monetary policy decision-making (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:823

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