Where do Personal Experience and Imitation Drive Choice?

Leonardo Boncinelli

Department of Economics University of Siena from Department of Economics, University of Siena

Abstract: This papers investigates the efficiency of aggregate choice in the long run when the individual decision is driven by both personal experience and imitation. Personal experience is represented by choice sets depending upon previous choices. Imitation is modeled first through popularity weighting and then through a network of social influences. Intuition suggests imitation can work as a source of variety, spreading behaviors among which memory can make selection. However inefficiencies will persist in the stochastically stable distribution whenever the length of memory is not sufficiently long to stop inferior behaviors from moving perpetually along periodic cycles of social influences.

Keywords: imitation; personal experience; limited cognitive capabilities (search for similar items in EconPapers)
JEL-codes: D01 D80 D81 D85 Z13 (search for similar items in EconPapers)
Date: 2007-10
New Economics Papers: this item is included in nep-cbe, nep-dcm and nep-evo
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Persistent link: https://EconPapers.repec.org/RePEc:usi:wpaper:519

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