Gender differences in decisions under profound uncertainty are non-robust to the availability of information on equally informed others’ decisions

Abstract

We investigated in the laboratory whether gender differences in decisions made under uncertainty without information on decisions of equally informed others are robust to the availability of that information. Participants specified in each of at most 60 periods four capital volumes making up the skeletal balance sheet of a financial institution in a computer-simulated environment with rare but potentially payoff-devastating crises. In the main study, we compared decision outcomes from two treatments: in the first, a participant had access to information on business numbers of two other participants, at least one of whom – unknown to the participant – was of the opposite sex (treatment with group information); in the second, no such outside information was available (treatment without group information). Our main finding is that, without group information, men adopted significantly more risk-exposed financial positions than women, whereas this pattern did not obtain beyond the first few periods when group information was available. A further study produced evidence that this effect of the availability of group information upon risk exposure is moderated by the gender composition of the groups. We also confirm the well-established tendency of social information to diminish cross-sectional variability in decisions.