Implementing the "Wisdom of the Crowd"

Ilan Kremer, Yishay Mansour and Motty Perry

No 270435, Economic Research Papers from University of Warwick - Department of Economics

Abstract: We study a novel mechanism design model in which agents each arrive sequentially and choose one action from a set of actions with unknown rewards. The information revealed by the principal a¤ects the incentives of the agents to explore and generate new information. We characterize the optimal disclosure policy of a planner whose goal is to maximize social welfare. One interpretation of our result is the implementation of what is known as the "wisdom of the crowd". This topic has become increasingly relevant with the rapid spread of the Internet over the past decade.

Keywords: Financial; Economics (search for similar items in EconPapers)
Pages: 35
Date: 2013-05-25
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:uwarer:270435

DOI: 10.22004/ag.econ.270435

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