Individual or team decision-making –Causes and consequences of self-selection

Even though decision-making in small teams is pervasive in business and in private life, littleis known about subjects’ preferences with respect to individual and team decision-making andabout the consequences of respecting these preferences. We report the results from anexperimental beauty-contest game, where subjects could endogenously choose their preferredway of decision-making. About 60% of subjects prefer to act in a team, and teams win thegame significantly more often than individuals. Nevertheless, both individuals and teammembers are highly satisfied with their chosen role, but for different reasons.