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Decision Making and Learning in a Globalizing World

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  • Otto H. Swank

    (Erasmus University Rotterdam)

  • Bauke Visser

    (Erasmus University Rotterdam)

Abstract

We study two aspects of globalization. It allows a decision-maker to go beyond his own local experience and to learn from other decision-makers in addressing common problems. This improves the identification and diffusion of best practices. It also provides extra information to `markets' that evaluate decision-makers: comparisons become possible. We identify conditions under which the globalization of markets helps or hurts (i) the communication among decision-makers about their own experience and (ii) the quality of the decision that is taken next. An important mediating factor is whether decision-making is centralized or decentralized.

Suggested Citation

  • Otto H. Swank & Bauke Visser, 2010. "Decision Making and Learning in a Globalizing World," Tinbergen Institute Discussion Papers 10-034/1, Tinbergen Institute.
    • Handle: RePEc:tin:wpaper:20100034
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    Cited by:

    1. Otto H. Swank & Bauke Visser, 2015. "Learning from Others? Decision Rights, Strategic Communication, and Reputational Concerns," American Economic Journal: Microeconomics, American Economic Association, vol. 7(4), pages 109-149, November.

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    More about this item

    Keywords

    centralization; decentralization; learning; cheap talk; reputational concerns; globalization; policy diffusion;
    All these keywords.

    JEL classification:

    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact

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