Strategic Learning and the Topology of Social Networks

Elchanan Mossel, Allan Sly, Omer Tamuz

Research output: Contribution to journalArticle

19 Scopus citations

Abstract

We consider a group of strategic agents who must each repeatedly take one of two possible actions. They learn which of the two actions is preferable from initial private signals and by observing the actions of their neighbors in a social network. We show that the question of whether or not the agents learn efficiently depends on the topology of the social network. In particular, we identify a geometric "egalitarianism" condition on the social network that guarantees learning in infinite networks, or learning with high probability in large finite networks, in any equilibrium. We also give examples of nonegalitarian networks with equilibria in which learning fails.

Original languageEnglish (US)
Pages (from-to)1755-1794
Number of pages40
JournalEconometrica
Volume83
Issue number5
DOIs
StatePublished - Sep 2015

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics

Keywords

  • Aggregation of information
  • Informational externalities
  • Social learning
  • Social networks

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