Stress and strategic decision-making in the beauty contest game

Faculty/Professorship: Personality Psychology and Psychological Assessment  
Author(s): Leder, Johannes  ; Häusser, Jan A.; Mojzisch, Andreas
Title of the Journal: Psychoneuroendocrinology
ISSN: 0306-4530
Year of publication: 2013
Volume: 38
Issue: 9
Pages: 1503-1511
Language(s): English
DOI: 10.1016/j.psyneuen.2012.12.016
Often, economic decisions do not only depend on one's own preferences, but also on the choices of others and therefore require strategizing (i.e., thinking about what others might think). In experimental economics, this has been modeled by the beauty contest game. Another typical feature of economic decisions is that they are often carried out under stress. Therefore, in the present study, we aimed to examine the influence of stress on decision-making in the beauty contest game. Participants were randomly assigned to either the Trier Social Stress Test for Groups (TSST-G) or a placebo version of the TSST-G (control condition). Then, participants played four rounds of a standard beauty contest game. As a biomarker of stress, salivary cortisol was measured. As predicted, participants under stress chose higher numbers in the beauty contest game than non-stressed participants, indicating less strategizing. This effect was mediated by the stress-induced increase in cortisol.
Keywords: Stress reaction, cortisol, strategic interaction, decision making
Type: Article
Year of publication: 15. October 2015