Subjects will take part in a search experiment, either individually (individual treatment) or in groups of 3 (committee treatment). The group or individual will receive offers until either acceptance or random termination of the game. Each offer corresponds to a round. When an offer is accepted, the search ends, and each subject receives the value of their own offer (or the value of the common offer in the common value treatment) as experimental points, to be converted into monetary payments at the end of the session.
Offers are drawn independently each round, from a commonly known distribution. We will elicit subjects’ reservation values using an incentive-compatible BDM mechanism (after Brown, Flynn and Schotter, AER, 2011): subjects will enter their “minimum acceptance value” (i.e., their reservation value) before their offer is drawn. Subjects will set their reservation value each round before an offer is made. Subjects may set different reservation values in different rounds.
In the individual search, an individual receives one offer every round. A subject will automatically accept the offer when it is equal to or above that value, otherwise she will reject.
In the committee search case, a vote will be cast automatically, to accept the offer (common value case) or set of offers (private value case) if the offer has a value that is equal to or above the minimum acceptance value, or to reject otherwise.
In all treatments: time preferences will be experimentally induced with random termination. The experimental discount rate will be set at 95%, which corresponds to a 5% termination probability per round. We will implement a block random termination à la Frechette and Yuksel (EE 2017), with blocks of 5 rounds.
In the committee treatments, subjects will not observe the reservation value set by other players for that round, nor will they observe the vote cast by each player or the total precise number of votes cast in favor of acceptance. They will only observe if their group decided to accept or reject the offer or set of offers. They will also have access to the history of the reservation values, offers drawn, and own vote, for the previous rounds of the current game.
For the committee treatments, we will also elicit the subjects’ beliefs about the reservation values set by a random other group member, in later rounds of the game. Subjects will be incentivized for accuracy.
In the committee with private value treatments, we will also introduce games where subjects play against group members who are computers with pre-defined strategies that are known to the subject. The goal of these treatments is to allow the analysis of best-response behavior when agents know the strategies played by other committee members. We will vary these pre-defined strategies.