What Is Groupthink In Behavioral Economics?

Groupthink is a psychological phenomenon that occurs when a group of people make decisions without fully considering all the options. This can happen when the members of the group are under pressure to come to a consensus and are afraid to express their own opinions or ideas. As a result, the group may make decisions that are not in their best interest, and may ignore potential problems or negative consequences.

Groupthink can have serious consequences, and has been blamed for many poor decisions made by groups, including government and business organizations. For example, during the Vietnam War, the United States government made several decisions that were later criticized as being the result of groupthink, including the decision to escalate the war and the decision to launch the Bay of Pigs invasion. To avoid groupthink, it is important for groups to encourage open and honest communication, and to consider a diverse range of perspectives and options before making decisions.

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