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Influential Opinion Leaders

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  • Jakub Steiner
  • Colin Stewart

Abstract

We present a two-stage coordination game in which early choices of experts with special interests are observed by followers who move in the second stage. We show that the equilibrium outcome is biased toward the experts' interests even though followers know the distribution of expert interests and account for it when evaluating observed experts' actions. Expert influence is fully decentralized in the sense that each individual expert has a negligible impact. The bias in favor of experts results from a social learning effect that is multiplied through a coordination motive. We show that the total effect can be large even if the direct social learning effect is small. We apply our results to the diffusion of products with network externalities and the onset of social movements.

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Bibliographic Info

Paper provided by The Center for Economic Research and Graduate Education - Economic Institute, Prague in its series CERGE-EI Working Papers with number wp458.

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Date of creation: Oct 2012
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Handle: RePEc:cer:papers:wp458

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Keywords: voting; coordination; experts;

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References

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  1. Gene M. Grossman & Elhanan Helpman, 2002. "Special Interest Politics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262571676.
  2. Giancarlo Corsetti & Amil Dasgupta & Stephen Morris & Hyun Song Shin, 2004. "Does One Soros Make a Difference? A Theory of Currency Crises with Large and Small Traders," Review of Economic Studies, Wiley Blackwell, vol. 71(1), pages 87-113, 01.
  3. Barry Nalebuff & Ron Shachar, 1999. "Follow the Leader: Theory and Evidence on Political Participation," American Economic Review, American Economic Association, vol. 89(3), pages 525-547, June.
  4. Kevin Murphy & Andrei Shleifer, 2004. "Persuasion in Politics," NBER Working Papers 10248, National Bureau of Economic Research, Inc.
  5. Ekmekci, Mehmet, 2009. "Manipulation through political endorsements," Journal of Economic Theory, Elsevier, vol. 144(3), pages 1227-1248, May.
  6. Steven Callander, 2007. "Bandwagons and Momentum in Sequential Voting," Review of Economic Studies, Wiley Blackwell, vol. 74(3), pages 653-684, 07.
  7. Stephen Coate, 2004. "Pareto-Improving Campaign Finance Policy," American Economic Review, American Economic Association, vol. 94(3), pages 628-655, June.
  8. Forsythe, R. & Myerson, R. & Rietz, T. & Weber, R., 1991. "An Experiment on Coordination in Multi-Candidate Elections: The Importance of Polls and Election Histories," Working Papers 91-31, University of Iowa, Department of Economics.
  9. DellaVigna, Stefano & Kaplan, Ethan, 2006. "The Fox News Effect: Media Bias and Voting," Seminar Papers 748, Stockholm University, Institute for International Economic Studies.
  10. Stephen Morris & Bernardo Guimaraes, 2004. "Risk and Wealth in a Model of Self-Fulfilling Currency Attacks," Yale School of Management Working Papers ysm424, Yale School of Management.
  11. George-Marios Angeletos & Alessandro Pavan, 2007. "Dynamic Global Games of Regime Change: Learning, Multiplicity and Timing of Attacks," Discussion Papers 1497, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  12. Chris Edmond, 2011. "Information Manipulation, Coordination, and Regime Change," Department of Economics - Working Papers Series 1125, The University of Melbourne.
  13. Duncan J. Watts & Peter Sheridan Dodds, 2007. "Influentials, Networks, and Public Opinion Formation," Journal of Consumer Research, University of Chicago Press, vol. 34(4), pages 441-458, 05.
  14. George-Marios Angeletos & Christian Hellwig & Alessandro Pavan, 2007. "Dynamic Global Games of Regime Change: Learning, Multiplicity, and the Timing of Attacks," Econometrica, Econometric Society, vol. 75(3), pages 711-756, 05.
  15. Jakub Steiner, 2006. "Coordination in a Mobile World," CERGE-EI Working Papers wp295, The Center for Economic Research and Graduate Education - Economic Institute, Prague.
  16. David P. Myatt, 2007. "On the Theory of Strategic Voting," Review of Economic Studies, Wiley Blackwell, vol. 74(1), pages 255-281, 01.
  17. Katz, Michael L & Shapiro, Carl, 1985. "Network Externalities, Competition, and Compatibility," American Economic Review, American Economic Association, vol. 75(3), pages 424-40, June.
  18. Katz, Michael L & Shapiro, Carl, 1986. "Technology Adoption in the Presence of Network Externalities," Journal of Political Economy, University of Chicago Press, vol. 94(4), pages 822-41, August.
  19. Callander, Steven, 2008. "Majority rule when voters like to win," Games and Economic Behavior, Elsevier, vol. 64(2), pages 393-420, November.
  20. Dasgupta, Amil, 2007. "Coordination and delay in global games," Journal of Economic Theory, Elsevier, vol. 134(1), pages 195-225, May.
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Blog mentions

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  1. What Should We Do About Influential Opinion Leaders รข?? Expert Biases & Election Outcomes
    by Miguel in Simoleon Sense on 2010-04-29 14:47:37

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