Informational Cascades and Social Conventions

THE NEW PALGRAVE DICTIONARY OF ECONOMICS AND THE LAW, May 1988

University of Michigan Business School Working Paper No. 9705-10

24 Pages Posted: 5 Oct 2008 Last revised: 29 Sep 2009

See all articles by David A. Hirshleifer

David A. Hirshleifer

University of California, Irvine - Paul Merage School of Business; NBER

Date Written: April 1, 1997

Abstract

This entry reviews how the theory of informational cascades (in which an individual's action is independent of his private information signal) explains the conformity, idiosyncrasy, and fragility of social behavior. It considers the effects on social outcomes of fashion leaders and of the public release of information. The entry further discusses the implications of informational cascades in various contexts, including fads, finance, medical practice, peer influence, politics, scientific theory, stigma, and zoology.

Suggested Citation

Hirshleifer, David A., Informational Cascades and Social Conventions (April 1, 1997). University of Michigan Business School Working Paper No. 9705-10; University of Michigan Business School Working Paper No. 9705-10. Available at SSRN: https://ssrn.com/abstract=1278626

David A. Hirshleifer (Contact Author)

University of California, Irvine - Paul Merage School of Business ( email )

Irvine, CA California 92697-3125
United States

HOME PAGE: http://sites.uci.edu/dhirshle/

NBER ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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