Economic modelling triggers more efficient planning: An experimental justification

Consider a firm as an organization that needs to efficiently coordinate several specialized departments in an uncertain environment. Decision making involves collective planning sessions and decentralized processes. In this setting this paper explores the role of economic modelling through an experimental game. Results support the idea that economic modelling favors higher performance. Economic modeling facilitates the emergence of common knowledge and the decomposition of a group decision problem into individual decision problems that are meaningfully interrelated.