Superstition and Rational Learning

Authors: Fudenberg, Drew; Levine, David K.

Source: The American Economic Review, Volume 96, Number 3, June 2006 , pp. 630-651(22)

Publisher: American Economic Association

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Abstract:

We argue that some, but not all, superstitions can persist when learning is rational and players are patient, and illustrate our argument with an example inspired by the Code of Hammurabi. The code specified an "appeal by surviving in the river" as a way of deciding whether an accusation was true. According to our theory, a mechanism that uses superstitions two or more steps off the equilibrium path, such as "appeal by surviving in the river," is more likely to persist than a superstition where the false beliefs are only one step off the equilibrium path.

Document Type: Research article

Publication date: 2006-06-01

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The American Economic Review is a general-interest economics journal. The journal is published quarterly and contains articles on a broad range of topics. Established in 1911, the AER is among the nation's oldest and most respected scholarly journals in the economics profession.
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