Recent world events such as the Brexit vote and the election of Donald Trump as the US President call to question the decision-making process and how rational it really is. This is the focus of Marie Curie fellow and assistant professor at Maastricht University School of Business and Economics Dominik Karos’ research project, BEiNG (Behavioural Economics in Network Games).
“I’m a game theorist,” Karos says. “I’m interested in individual decision making. Many social decisions are not taken on a stand-alone basis by an individual, but by groups that influence each other, depending on the social networks.”
By social network, Karos means anyone with whom you interact. “You basically look around to see what people are doing and you decide maybe to follow them or to do something very different,” he says. “In either case, your social environment has a lot of influence on what you do.”
And your decisions, in turn, he explains, have an impact on your network. “What you do and what opinions you have and other people’s opinions might affect the social network itself,” he says. “On Facebook, for example, you will probably be connected with people who are similar to you. Facebook will suggest links to you all the time based on your preferences. So you see this affect from different sides: There’s the social network that influences your decisions and then there’s the decision you take that will influence who you will meet afterwards.”
The behavioural economics part, he says, is where irrational thought comes in. “We try to incorporate irrational behaviour: You want information to inform good decisions,” he explains. “But, there’s a lot of evidence that people don’t do that. They actually ignore information they don’t like, which then has an impact on with whom you’re connecting because if you ignore people who have an opinion you don’t like, you don’t listen to them. In the worst case, you cut the link to them, which could lead to segregation.”
Karos has already completed much of the theory side of his research, and will organise experiments as the next phase of the project. “My idea is to feed participants with different information and let them make a decision based on it, and see if those with ‘faulty information will be excluded from the group,” he says.
This article is the third of a three-part series exploring the research projects of three SBE researchers who this year received Marie Curie grants. The award, named after the double Nobel Prize winning Polish-French scientist famed for her work on radioactivity, supports researchers working across all disciplines, from life-saving healthcare to ‘blue-sky’ science, are eligible for funding.