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  3. American Economic Journal: Microeconomics
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  5. (Pro-)Social Learning and Strategic Disclosure

American Economic Journal:
Microeconomics

ISSN 1945-7669 (Print) | ISSN 1945-7685 (Online)

(Pro-)Social Learning and Strategic Disclosure

  • Roland Bénabou
  • Nikhil Vellodi
American Economic Journal: Microeconomics (Forthcoming)

Abstract

We study a sequential experimentation model with endogenous feedback. Agents choose between a safe and risky action, the latter generating stochastic rewards. When making this choice, each agent is selfishly motivated (myopic). However, agents can disclose their experiences to a public record, and when doing so are pro-socially motivated (forward-looking). Disclosure is both polarized (only extreme signals are disclosed) and positively biased (no feedback is bad news). The extent of disclosure is non-monotone in prior uncertainty. Subsidizing disclosure costs can paradoxically lead to less disclosure, but more experimentation.

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