Informational Herding as Experimentation Deja Vu

Lones Smith and Peter Sørensen

Working papers from Massachusetts Institute of Technology (MIT), Department of Economics

Abstract: We prove that the recently proposed informational herding models are but special cases of a standard single person experimentation model with myopia. We then re-interpret the incorrect herding outcome as a familiar failure of complete learning in an optimal experimentation problem.

Keywords: ECONOMETRICS; MATHEMATICS; EXPERIMENTATION; MODELS (search for similar items in EconPapers)
JEL-codes: C00 C90 C99 (search for similar items in EconPapers)
Pages: 15 pages
Date: 1996
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Persistent link: https://EconPapers.repec.org/RePEc:mit:worpap:96-9

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