An Experimental Test of Advice and Social Learning

Bo\u{g}açhan Çelen (), Shachar Kariv () and Andrew Schotter
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Bo\u{g}açhan Çelen: Graduate School of Business, Columbia University, New York, New York 10027
Shachar Kariv: Department of Economics, University of California, Berkeley, Berkeley, California 94720

Management Science, 2010, vol. 56, issue 10, 1687-1701

Abstract: Social learning describes any situation in which individuals learn by observing the behavior of others. In the real world, however, individuals learn not just by observing the actions of others but also from seeking advice. This paper introduces advice giving into the standard social-learning experiment of Çelen and Kariv (Çelen, B., S. Kariv. 2005. An experimental test of observational learning under imperfect information. Econom. Theory 26(3) 677-699). The experiments are designed so that both pieces of information--action and advice--are equally informative (in fact, identical) in equilibrium. Despite the informational equivalence of advice and actions, we find that subjects in a laboratory social-learning situation appear to be more willing to follow the advice given to them by their predecessor than to copy their action, and that the presence of advice increases subjects' welfare.

Keywords: experiment; naïve advice; social learning; word-of-mouth learning (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (50)

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Related works:
Working Paper: An Experimental Test of Advice and Social Learning (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:inm:ormnsc:v:56:y:2010:i:10:p:1687-1701

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