Searching for information

Jungsuk Han and Francesco Sangiorgi

Journal of Economic Theory, 2018, vol. 175, issue C, 342-373

Abstract: This paper provides a search-based information acquisition framework using an urn model with an asymptotic approach. The underlying intuition of the model is simple: when the scope of information search is more limited, marginal search efforts produce less useful information due to redundancy, but commonality of information among different agents increases. Consequently, limited information searchability induces a trade-off between an information source's precision and its commonality. In a “beauty contest” game with endogenous information acquisition, this precision-commonality trade-off generates non-fundamental volatility through the channel of information acquisition.

Keywords: Information acquisition; Information search; Commonality of information; Urn model; Coordination games (search for similar items in EconPapers)
JEL-codes: C65 D80 D81 D83 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0022053118300346
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Searching for Information* (2015)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jetheo:v:175:y:2018:i:c:p:342-373

DOI: 10.1016/j.jet.2018.01.021

Access Statistics for this article

Journal of Economic Theory is currently edited by A. Lizzeri and K. Shell

More articles in Journal of Economic Theory from Elsevier
Bibliographic data for series maintained by Catherine Liu ().