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Synchronization in human decision-making

Abstract : Just as soldiers crossing a bridge in sync can produce a catastrophic structural failure, we use experiment, theory, and simulation to show how synchronization in human decision-making can lead to extreme outcomes. Individual decision-making and risk-taking are well known to be gender dependent. However, much less is known about the impact of gender on the generation of collective risk through aggregate decision-making, where the decision of one individual can affect the decision-making of other individuals, leading eventually to synchronization of behavior. To study the formation of collective risk as generated by synchronization in human decision-making, we have devised a series of experiments that can be analyzed and understood within a game-theoretical framework. Experiments involve groups of either men or women, and each individual decides to buy or sell a financial asset using information that contains previous price trends and economic news. Risk can be generated collectively through coordination in the aggregate decision-making, which leads to a price formation far from the fundamental value of the asset. Here we show that collective risk can be generated in groups of either gender, but also that the way it is generated happens through a different type of individual risk-taking for groups composed of men and groups composed of women
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https://hal.archives-ouvertes.fr/hal-03029555
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Submitted on : Saturday, November 28, 2020 - 4:52:06 PM
Last modification on : Friday, April 29, 2022 - 10:12:43 AM

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Yi-Fang Liu, Jørgen Vitting Andersen, Maxime Frolov, Philippe de Peretti. Synchronization in human decision-making. Chaos, Solitons and Fractals, Elsevier, 2021, 143, pp.110521. ⟨10.1016/j.chaos.2020.110521⟩. ⟨hal-03029555⟩

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