Observational Learning: Evidence from a Randomized Natural Field Experiment
American Economic Review, Vol. 99, No. 3, pp. 864–882, 2009
Posted: 7 Jan 2011
Date Written: 2009
We report results from a randomized natural field experiment conducted in a restaurant dining setting to distinguish the observational learning effect from the saliency effect. We find that, when customers are given ranking information of the five most popular dishes, the demand for those dishes increases by 13 to 20 percent. We do not find a significant saliency effect. We also find modest evidence that the observational learning effects are stronger among infrequent customers, and that dining satisfaction is increased when customers are presented with the information of the top five dishes, but not when presented with only names of some sample dishes.
Keywords: field experiment, China, observational learning effect, saliency effect
JEL Classification: C93, D83
Suggested Citation: Suggested Citation