An Experiment on Social Mislearning

Matthew Rabin, Erik Eyster and Weizsäcker, Georg
Authors registered in the RePEc Author Service: Georg Weizsäcker

No 11020, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We investigate experimentally whether social learners appreciate the redundancy of information conveyed by their observed predecessors' actions. Each participant observes a private signal and enters an estimate of the sum of all earlier-moving participants' signals plus her own. In a first treatment, participants move single-file and observe all predecessors' entries; Bayesian Nash Equilibrium (BNE) predicts that each participant simply add her signal to her immediate predecessor's entry. Although 75% of participants do so, redundancy neglect by the other 25% generates excess imitation and mild inefficiencies. In a second treatment, participants move four per period; BNE predicts that most players anti-imitate some observed entries. Such anti-imitation occurs in 35% of the most transparent cases, and 16% overall. The remaining redundancy neglect creates dramatic excess imitation and inefficiencies: late-period entries are far too extreme, and on average participants would earn substantially more by ignoring their predecessors altogether.

Keywords: Experiments; Higher-order beliefs; Redundancy neglect; Social learning (search for similar items in EconPapers)
JEL-codes: B49 (search for similar items in EconPapers)
Date: 2015-12
New Economics Papers: this item is included in nep-exp
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Working Paper: An Experiment On Social Mislearning (2018)
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