On the Efficiency of Social Learning

Dinah Rosenberg () and Nicolas Vieille ()

No 1246, HEC Research Papers Series from HEC Paris

Abstract: We revisit well-known models of learning in which a sequence of agents make a binary decision on the basis of a private signal and additional information. We introduce efficiency measures, aimed at capturing the speed of learning in such contexts. Whatever the distribution of private signals, we show that the learning efficiency is the same, whether each agent observes the entire sequence of earlier decisions, or only the previous decision. We provide a simple necessary and sufficient condition on the signal distributions under which learning is efficient. This condition fails to hold in many prominent cases of interest. Extensions are discussed.

Keywords: Social Learning (search for similar items in EconPapers)
JEL-codes: D83 (search for similar items in EconPapers)
Pages: 41 pages
Date: 2017-11-09
New Economics Papers: this item is included in nep-mic
Note: models of learning; Social Learning
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:ebg:heccah:1246

DOI: 10.2139/ssrn.3081876

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