Social Learning in a Changing World
In the social learning model of Banerjee  and Bikhchandani, Hirshleifer and Welch  individuals take actions sequentially after observing the history of actions taken by the predecessors and an informative private signal. If the state of the world is changing stochastically over time during the learning process, only temporary informational cascades situations where socially valuable information is wasted can arise. Furthermore, no cascade ever arises when the environment changes in a su¢ciently unpredictable way.
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- Giuseppe Moscarin & Marco Ottaviani & Lones Smith, .
"Social Learning in a Changing World,"
ELSE working papers
010, ESRC Centre on Economics Learning and Social Evolution.
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Game Theory and Information
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