Economics at your fingertips  

Rational Groupthink

Matan Harel, Elchanan Mossel, Philipp Strack and Omer Tamuz

Papers from

Abstract: We study how long-lived rational agents learn from repeatedly observing each others' actions. We find that in the long run, information aggregation fails, and the fraction of private information transmitted goes to zero as the number of agents gets large. With Normal signals, in the long-run, agents learn less from observing the actions of any number of other agents than they learn from seeing three other agents' signals. We identify rational groupthink---in which agents ignore their private signals and choose the same action for long periods of time---as the cause of this failure of information aggregation.

Date: 2014-12, Revised 2018-12
References: View references in EconPapers View complete reference list from CitEc
Citations Track citations by RSS feed

Downloads: (external link) Latest version (application/pdf)

Related works:
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:

Access Statistics for this paper

More papers in Papers from
Bibliographic data for series maintained by arXiv administrators ().

Page updated 2018-12-19
Handle: RePEc:arx:papers:1412.7172