Signal accuracy and informational cascades
Tuvana Pastine and
No 200620, Working Papers from School of Economics, University College Dublin
We extend the Bikhchandani, Hirshleifer and Welch (1992) informational cascade framework to allow for asymmetric signal accuracy. Simulations demonstrate that even small departures from symmetry may lead to non-monotonic effects of signal accuracy on the likelihood of an inefficient cascade.
Keywords: Learning; Signal Precision; Herding; Information behavior--Mathematical models (search for similar items in EconPapers)
JEL-codes: D80 (search for similar items in EconPapers)
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http://hdl.handle.net/10197/698 First version, 2006 (application/pdf)
Working Paper: Signal Accuracy and Informational Cascades (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:ucn:wpaper:200620
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