Naïve herding in rich-information settings

American Economic Journal: Microeconomics

Volumn 2, Issue 4, 2010, Pages 221-243

  Eyster, Erik ^a   Rabin, Matthew ^b  

^a LONDON SCHOOL OF ECONOMICS   (United Kingdom)

^b UNIVERSITY OF CALIFORNIA   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

EID: 85017182892     PISSN: 19457669     EISSN: 19457685     Source Type: Journal    
DOI: 10.1257/mic.2.4.221     Document Type: Article

References (26)

1. Avery, Christopher, and Peter Zemsky. 1998. "Multidimensional Uncertainty and Herd Behavior in Financial Markets." American Economic Review, 88(4): 724-48.
2. Banerjee, Abhijit V. 1992. "A Simple Model of Herd Behavior." Quarterly Journal of Economics, 107(3): 797-817.
3. Bikhchandani, Sushil, David Hirshleifer, and Ivo Welch. 1992. "A Theory of Fads, Fashion, Custom, and Cultural Change in Informational Cascades." Journal of Political Economy, 100(5): 992-1026.
4. Bohren, J. Aislinn. 2010. "Information-Processing Bias in Social Learning." http://econ.ucsd. edu/~abohren/pdfs/Bohren. BIPSocialLearning_032210.pdf.
5. Callander, Steven, and Johannes Hörner. 2009. "The Wisdom of the Minority." Journal of Economic Theory, 144(4): 1421-39.
6. Camerer, Colin F., Teck-Hua Ho, and Juin-Kuan Chong. 2004. "A Cognitive Hierarchy Model of Games." Quarterly Journal of Economics, 119(3): 861-98.
7. Çelen, Bo g ? açhan, and Shachar Kariv. 2005. "An Experimental Test of Observational Learning under Imperfect Information." Economic Theory, 26(3): 677-99.
8. Chamley, Christophe P. 2004. Rational Herds: Economic Models of Social Learning. Cambridge, UK: Cambridge University Press.
9. Crawford, Vincent P., and Nagore Iriberri. 2007. "Level-K Auctions: Can a Nonequilibrium Model of Strategic Thinking Explain the Winner's Curse and Overbidding in Private-Value Auctions?" Econometrica, 75(6): 1721-70.
10. DeMarzo, Peter M., Dimitri Vayanos, and Jeffrey Zwiebel. 2003. "Persuasion Bias, Social Influence, and Unidimensional Opinions." Quarterly Journal of Economics, 118(3): 909-68.
11. Eyster, Erik, and Matthew Rabin. 2005. "Cursed Equilibrium." Econometrica, 73(5): 1623-72.
12. Eyster, Erik, and Matthew Rabin. 2008. "Naïve Herding." http://pluto.huji.ac.il/~mshayo/public_ html/Eyster_naive_herding.pdf.
13. Eyster, Erik, and Matthew Rabin. 2009. "Rational and Naïve Herding." Centre for Economic Policy Research (CEPR) Discussion Paper DP7351.
14. Glosten, Lawrence R., and Paul R. Milgrom. 1985. "Bid, Ask, and Transaction Prices in a Specialist Market with Heterogeneously Informed Traders." Journal of Financial Economics, 14(1): 71-100.
15. Goeree, Jacob K., Thomas R. Palfrey, Brian W. Rogers, and Richard D. McKelvey. 2007. "Self-Correcting Information Cascades." Review of Economic Studies, 74(3): 733-62.
16. Guarino, Antonio, and Philippe Jehiel. 2009. "Social Learning with Coarse Inference." World Economy and Finance Research Programme Working Paper WEF0050. http://www.worldeconomyandfinance. org/working_papers_publications/working_paper_PDFs/WEF0050.pdf.
17. Jehiel, Philippe. 2005. "Analogy-Based Expectation Equilibrium." Journal of Economic Theory, 123(2): 81-104.
18. Kübler, Dorothea, and Georg Weizsäcker. 2004. "Limited Depth of Reasoning and Failure of Cascade Formation in the Laboratory." Review of Economic Studies, 71(2): 425-41.
19. Kübler, Dorothea, and Georg Weizsäcker. 2005. "Are Longer Cascades More Stable?" Journal of the European Economic Association, 3(2-3): 330-39.
20. Lee, In Ho. 1993. "On the Convergence of Informational Cascades." Journal of Economic Theory, 61(2): 395-411.
21. McKelvey, Richard D., and Thomas R. Palfrey. 1996. "A Statistical Theory of Equilibrium in Games." Japanese Economic Review, 47(2): 186-209.
22. Nagel, Rosemarie. 1995. "Unraveling in Guessing Games: An Experimental Study." American Economic Review, 85(5): 1313-26.
23. Rabin, Matthew, and Joel L. Schrag. 1999. "First Impressions Matter: A Model of Confirmatory Bias." Quarterly Journal of Economics, 114(1): 37-82.
24. Smith, Lones, and Peter Sørensen. 2000. "Pathological Outcomes of Observational Learning." Econometrica, 68(2): 371-98.
25. Stahl, Dale O., II, and Paul W. Wilson. 1994. "Experimental Evidence on Players' Models of Other Players." Journal of Economic Behavior and Organization, 25(3): 309-27.
26. Weizsäcker, Georg. Forthcoming. "Do We Follow Others When We Should? A Simple Test of Rational Expectations." American Economic Review.