Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/130412
Authors: 
March, Christoph
Year of Publication: 
2016
Series/Report no.: 
CESifo Working Paper 5783
Abstract: 
The paper investigates social-learning when the information structure is not commonly known. Individuals repeatedly interact in social-learning settings with distinct information structures. In each round of interaction, they use their experience gained in past rounds to draw inferences from their predecessors’ current decisions. Such adaptation yields rational behavior in the long-run if and only if individuals distinguish social-learning settings and receive rich feedback after each round. Limited feedback may lead individuals to imitate uninformed predecessors. Moreover, adaptation across social-learning settings renders Bayes’ rule payoff-inferior compared to non-Bayesian belief updating rules and suggests that belief-updating rules are heterogeneous in the population.
Subjects: 
informational herding
adaptation
analogy-based expectations equilibrium
Non-Bayesian updating
JEL: 
C73
D82
D83
Document Type: 
Working Paper

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