December 2008 issue contents
Leadership in Groups: A Monetary Policy Experiment

by Alan S. Blindera and John Morganb


This paper studies monetary policy decision making by committee, using an experimental methodology. In an earlier paper (Blinder and Morgan 2005), we found that groups not only outperformed individuals, but they also took no longer to reach decisions. We successfully replicate those results here. Next, we find little difference between the performances of fourperson and eight-person groups; the larger groups outperform the smaller groups by a very small (and often insignificant) margin. Third, and most surprisingly, we find no evidence of superior performance by groups that have designated leaders. Possible reasons for that strongly counterintuitive finding are discussed.

JEL Codes: C92, E58.

Full article (PDF, 34 pages 286 kb)

Princeton University
University of California, Berkeley