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The Dynamics of Collective Reputation

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Author Info
Jonathan Levin (Stanford University)

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Abstract

I present a stochastic version of Tirole's (1996) collective reputation model. In equilibrium, group behavior is persistent due to complementarity between the current incentives of group members and the group's reputation, which depends on its history. A group can maintain a strong reputation even as conditions become unfavorable, but an improvement in the environment may not help a group with a poor reputation. I also connect the model to the theory of statistical discrimination and show that the same mechanism can explain why discrimination might persist over time.

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File URL: http://www.bepress.com/cgi/viewcontent.cgi?article=1548&context=bejte
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Publisher Info
Article provided by Berkeley Electronic Press in its journal The B.E. Journal of Theoretical Economics.

Volume (Year): 9 (2009)
Issue (Month): 1 ()
Pages:
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Handle: RePEc:bpj:bejtec:v:9:y:2009:i:1:n:27

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Related research
Keywords: collective reputation; statistical discrimination;

Find related papers by JEL classification:
C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation

Cited by:
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  1. Kim, Young Chul & Loury, Glenn, 2009. "Group Reputation and the Dynamics of Statistical Discrimination," MPRA Paper 18765, University Library of Munich, Germany. [Downloadable!]
Statistics
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This page was last updated on 2009-12-17.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.