Observational Learning文献2. A simple model of herd behaviour.pdfVIP

A Simple Model of Herd Behavior Author(s): Abhijit V. Banerjee Source: The Quarterly Journal of Economics, Vol. 107, No. 3 (Aug., 1992), pp. 797-817 Published by: Oxford University Press Stable URL: /stable/2118364 Accessed: 20-08-2014 12:52 UTC Your use of the JSTOR archive indicates your acceptance of the Terms Conditions of Use, available at /page/info/about/policies/terms.jsp JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@. Oxford University Press is collaborating with JSTOR to digitize, preserve and extend access to The Quarterly Journal of Economics. This content downloaded from 38 on Wed, 20 Aug 2014 12:52:13 UTC All use subject to JSTOR Terms and Conditions THE QUARTERLYJOURNAL OF ECONOMICS Vol. CVII August 1992 Issue 3 A SIMPLE MODEL OF HERD BEHAVIOR* ABHIJIT V. BANERJEE We analyze a sequential decision model in which each decision maker looks at the decisions made by previous decision makers in taking her own decision. This is rational for her because these other decision makers may have some information that is important for her. We then show that the decision rules that are chosen by optimizing individuals will be characterized by herd behavior; i.e., people will be doing what others are doing rather than using their information. We then show that the resulting equilibr