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We study a sequential model of Bayesian social learning in networks in which agents have heterogeneous preferences, and neighbors tend to have similar preferences—a phenomenon known as homophily. We find that the density of network connections determines the impact of preference diversity and homophily on learning. When connections are sparse, diverse(More)
Social ties convey information through observations of others' decisions as well as through conversations and the sharing of opinions. The resulting information flows play a role in a range of phenomena, including job search (Montgomery 1991), financial planning (Duflo and Saez 2003), product choice (Trusov et al. 2009), and voting (Beck et al. 2002).(More)
I study a game in which individuals gather costly information about an innovation and share their knowledge through social ties. A person's incentive to experiment varies with her position in the network, and strategic interactions lead to counterintuitive behavior among the most connected players. The structure of the social network and the distribution of(More)
Extended Abstract We consider the perfect Bayesian equilibrium of a model of social learning on networks where agents do not know the topology of the social network. Each agent receives a signal about an underlying state of the world, observes actions of her neighbors and subsequently chooses an action herself. The topology of the social network is drawn(More)
We study relational contracts between a principal and an agent when they face symmetric uncertainty about the match quality. Actions affect learning about the match quality and the principal's payoffs. Because the agent's actions are perfectly observable , the agent cannot bias the principal's beliefs. We show that even when the agent is not protected by(More)
Social ties convey information through observations of others' decisions as well as through conversations and the sharing of opinions. The resulting information flows play a role in a range of phenomena, including job search (Montgomery 1991), financial planning (Duflo and Saez 2003), product choice (Trusov et al. 2009), and voting (Beck et al. 2002).(More)
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