Welcome to this experiment about decision making. It will take approximately 1 hour.
Please read the instructions carefully. A good understanding of the instructions is essential for making sound decisions and will affect your payment.
Click “Next” below to learn about your role.
The computer will randomly assign {{half_num_participants}} participants the role of Member A and the other {{half_num_participants}} the role of Member B. The roles remain fixed throughout the experiment.
There will be {{ tot_matches }} rounds of decisions. In each round, the computer will randomly and anonymously match one Member A with one Member B to form a decision group.
Click “Next” below for an overview of your experimental tasks.
The computer randomly draws a number X, unknown to both Member A and Member B.
Member A makes two decisions: (a) acquire information about X, and (b) choose a report to send to Member B.
Member B makes one decision: make a guess (G) about X after seeing Member A’s report.
As Member B’s guess (G) becomes more accurate (closer to X), his/her earning will be higher. Member A’s earning will be higher if Member B’s guess (G) is closer to [X + a constant].
Click “Next” below to learn more about Member A’s first decision.
The unknown X is a number with one decimal randomly drawn from [0.0, 100.0].
Member A acquires information about X by cutting [0.0, 100.0] into N equal pieces. The computer will reveal to Member A which one of the N pieces contains X.
Example: 3-Piece Cut (N = 3). If X is drawn to be 30.2, the computer will reveal that X lies in [0.0, 33.3]. If X = 50.6, it will reveal that X lies in [33.4, 66.7]. If X = 80.8, it will reveal that X lies in [66.8, 100.0].
In each round, Member A is given a budget of 100 reward points to pay for the cutting cost. Choosing N = 1 is free. Each additional piece costs 10 points to cut.
Cost cannot exceed budget: the possible choice of N ranges from 1 (no cut, no information, no cost) to 10 (10-piece cut, most information, highest cost at 100 points).
Click “Next” below to learn more about Member A’s second decision.
Given the first decision, the piece that contains X will be highlighted in blue on a bar. Figure 1 shows an example where a 3-piece cut was chosen and the middle piece contained X.
Figure 1: Member A’s Screen 1
Member B will not see Member A’s choice of N and the blue piece.
Member A sends a report to Member B by clicking on the bar twice to outline a report, which will be shown as a yellow piece.
The yellow piece can be anywhere on the bar. Figure 2 shows an example where the yellow piece encompasses the blue piece (but this is not required).
Figure 2: Member A’s Screen 2
Click “Next” below to learn more about Member B’s decision.
Member A’s report, the yellow piece, will be shown on a similar bar.
Figure 3: Member B’s Screen
Member B makes a guess G by clicking on the bar once to pinpoint a number with one decimal in [0.0, 100.0].
Member B submitting his/her guess G marks the end of the round.
Click “Next” below to learn about Member A’s reward.
In addition to the cutting budget of 100 points, Member A will be given another 100 points in each round. The points that Member A can keep as earned reward increases as
according to the formula:
$${ \text{Member A’s Reward Points to Keep} = \left(100 - \frac{[G-(X+20)]^2 }{50} \right) + (100 − 10N)}$$
In case of a negative value, the earned reward for the round will be 0.
Click “Next” below to learn about Member B’s reward.
Member B will be given 150 points in each round. The points that Member B can keep as earned reward increases as G is closer to X, according to the following formula:
$${ \text{Member B’s Reward Points to Keep} = 150 - \frac{(G-X)^2}{50} }$$
In case of a negative value, the earned reward for the round will be 0.
Click “Next” below to learn about the event summary of each round.
At the end of each round, the computer will provide an event summary, which covers:
One round out of 40 will be randomly selected to calculate your cash payment. (So it is in your best interest to take each round seriously.)
Your total cash payment will be the reward points you earned in the randomly selected round (1 point = 1 HKD) plus a 40 HKD show-up fee.
To ensure your comprehension of the instructions, you will take a quiz and play 1 practice round.