Economic Theory

, Volume 51, Issue 3, pp 601–626

Herding with collective preferences

Research Article


This paper studies a simple model of observational learning where agents care not only about the information of others but also about their actions. We show that despite complex strategic considerations that arise from forward-looking incentives, herd behavior can arise in equilibrium. The model encompasses applications such as sequential elections, public good contributions, and leadership charitable giving.


Social learning Observational learning Herd behavior Payoff interdependence Sequential voting Momentum 

JEL Classification

D7 D8 


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Copyright information

© Springer-Verlag 2011

Authors and Affiliations

  1. 1.Department of EconomicsUniversity of California, San DiegoSan DiegoUSA
  2. 2.Department of EconomicsColumbia UniversityNew YorkUSA

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