On the absorbability of herd behaviour and informational cascades: an experimental analysis

Arbeitspapier

A theory is said to be fully absorbable whenever its own acceptance by all of the individuals belonging to a certain population does not question its predictive validity. This accounts for strategic equilibria and can be related to the logic underlying convergence of behaviour and intentional herding in sequential games. This paper discusses the absorbability of informational cascades' theory by bounded rational decision-makers and analyses whether providing individuals with theoretic information on informational cascades affects overall probability of herding phenomena to occur as well as whether an incorrect cascade can be reversed because of bounded rational adapting of the theory's prescriptive.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Dresden Discussion Paper Series in Economics ; No. 15/07

Classification and Topics

• Classification: Wirtschaft ; Design of Experiments: Laboratory, Individual ; Noncooperative Games
• Subject: Theory absorption ; Herd behaviour ; Informational cascades ; Herdenverhalten ; Informationsverhalten ; Beschränkte Rationalität ; Experiment ; theory absorption

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Morone, Andrea ; Fiore, Annamaria ; Sandri, Serena
• Event: Veröffentlichung
• (who): Technische Universität Dresden, Fakultät Wirtschaftswissenschaften
• (where): Dresden
• (when): 2007

Further information

• Handle: http://hdl.handle.net/10419/22756
• Last update: 10.03.2025, 11:45 AM CET