Social norms: Does it matter whether agents are rational or boundedly rational?
The motivation for this paper is to consider whether changes in conformity over time are likely to depend critically on agent behavior. To get some insight on this we use the framework of Chamley [Chamley, C., 1999. Coordinating regime switches. The Quarterly Journal of Economics 114, 869-905] and compare the dynamic of conformity in a setting where agents are rational to one where they are adaptive (or backward looking). This is followed by a more general discussion on the issue.
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Volume (Year): 38 (2009)
Issue (Month): 3 (June)
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