A Simple Model of Herd Behavior Export

@article{banerjee92, abstract = {We analyze a sequential decision model in which each decision maker looks at the decisions made by previous decision makers in taking her own decision. This is rational for her because these other decision makers may have some information that is important for her. We then show that the decision rules that are chosen by optimizing individuals will be characterized by herd behavior; i.e., people will be doing what others are doing rather than using their information. We then show that the resulting equilibrium is inefficient.}, author = {Banerjee, Abhijit V.}, citeulike-article-id = {1341447}, citeulike-linkout-0 = {http://dx.doi.org/10.2307/2118364}, citeulike-linkout-1 = {http://www.jstor.org/stable/2118364}, doi = {10.2307/2118364}, issn = {00335533}, journal = {The Quarterly Journal of Economics}, keywords = {behaviour, decision, networks}, number = {3}, pages = {797--817}, posted-at = {2008-08-01 09:56:22}, priority = {3}, publisher = {The MIT Press}, title = {A Simple Model of Herd Behavior}, url = {http://dx.doi.org/10.2307/2118364}, volume = {107}, year = {1992} }

TY - JOUR ID - banerjee92 L3 - citeulike-article-id:1341447 N2 - We analyze a sequential decision model in which each decision maker looks at the decisions made by previous decision makers in taking her own decision. This is rational for her because these other decision makers may have some information that is important for her. We then show that the decision rules that are chosen by optimizing individuals will be characterized by herd behavior; i.e., people will be doing what others are doing rather than using their information. We then show that the resulting equilibrium is inefficient. IS - 3 JF - The Quarterly Journal of Economics SN - 00335533 EP - 817 TI - A Simple Model of Herd Behavior PB - The MIT Press VL - 107 SP - 797 KW - behaviour KW - decision KW - networks AU - Banerjee, Abhijit PY - 1992/// UR - http://dx.doi.org/10.2307/2118364 ER -