Social Learning With Endogenous Networks

Student: Kleshchevnikova Daria

Supervisor: Steven Kivinen

Faculty: International College of Economics and Finance

Educational Programme: Double degree programme in Economics of the NRU HSE and the University of London (Bachelor)

Year of Graduation: 2021

This paper analyses social learning with endogenous network formation. The concept of social learning is widely applicable and endogenous network formation is more plausible assumption than the exogenously given, on which the majority of works focus. I build a sequential social learning model featuring players selecting actions trying to match the true state of the world given the network created by previous players, private signal and ability to observe other players' actions at a certain cost. The choices of the first players in equilibrium are analyzed in details and general results are given. Then, I compare the cases with observable and unobservable network and provide the results regarding the discontinuity of learning function. Finally, results on achievability of social learning are provided.

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