Mimetic behaviour and institutional persistence: A two-armed bandit experiment

Stefania Innocenti & Robin Cowan

#2016-028

Institutions are the result of many individual decisions. Understanding how agents filter available information concerning the behaviour of others is therefore crucial. In this paper we investigate whether and how agents' self-efficacy beliefs affect mimetic behaviour and thus, implicitly the evolution of institutions. We propose an experimental task, which is a modified version of the two-armed bandit with finite time horizon. In the first treatment, we study in detail individual learning. In the second treatment, we measure how individuals use the information they gather while observing a randomly selected group leader. We find a negative relation between self-efficacy beliefs and the propensity to emulate a peer. This might ultimately affect the likelihood of institutional change.

Keywords: Emulation, mimicry, laboratory experiment, self-efficacy, institutional change

JEL Classification: B52, C13, C91, D02, D03, D83

  


UNU-MERIT