Template-Type: ReDIF-Paper 1.0
Series: Tinbergen Institute Discussion Papers
Creation-Date: 2010-03-19
Number: 10-034/1
Author-Name: Otto H. Swank
Author-Workplace-Name: Erasmus University Rotterdam
Author-Name: Bauke Visser
Author-Workplace-Name: Erasmus University Rotterdam
Title: Decision Making and Learning in a Globalizing World
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.
Classification-JEL: D83, D70, D02
Keywords: centralization, decentralization, learning, cheap talk, reputational concerns, globalization, policy diffusion
File-Url: https://papers.tinbergen.nl/10034.pdf
File-Format: application/pdf
File-Size: 622003 bytes
Handle: RePEc:tin:wpaper:20100034