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Decision Making and Learning in a Globalizing World

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  • Otto H. Swank

    (Erasmus University Rotterdam)

  • Bauke Visser

    (Erasmus University Rotterdam)

Abstract

We study two aspects of globalization. It allows a decision-maker to go beyond his own local experience and to learn from other decision-makers in addressing common problems. This improves the identification and diffusion of best practices. It also provides extra information to `markets' that evaluate decision-makers: comparisons become possible. We identify conditions under which the globalization of markets helps or hurts (i) the communication among decision-makers about their own experience and (ii) the quality of the decision that is taken next. An important mediating factor is whether decision-making is centralized or decentralized.

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Bibliographic Info

Paper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 10-034/1.

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Date of creation: 19 Mar 2010
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Handle: RePEc:dgr:uvatin:20100034

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Web page: http://www.tinbergen.nl

Related research

Keywords: centralization; decentralization; learning; cheap talk; reputational concerns; globalization; policy diffusion;

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