Decision Making and Learning in a Globalizing World

Otto Swank () and Bauke Visser

No 10-034/1, Tinbergen Institute Discussion Papers from Tinbergen Institute

Abstract: We study two aspects of globalization. It allows a decision-maker to go beyond his own local experience and to learn from other decision-makers in addressing common problems. This improves the identification and diffusion of best practices. It also provides extra information to `markets' that evaluate decision-makers: comparisons become possible. We identify conditions under which the globalization of markets helps or hurts (i) the communication among decision-makers about their own experience and (ii) the quality of the decision that is taken next. An important mediating factor is whether decision-making is centralized or decentralized.

Keywords: centralization; decentralization; learning; cheap talk; reputational concerns; globalization; policy diffusion (search for similar items in EconPapers)
JEL-codes: D02 D70 D83 (search for similar items in EconPapers)
Date: 2010-03-19
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Related works:
Working Paper: Decision Making and Learning in a Globalizing World (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:tin:wpaper:20100034

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