Strategic Ignorance as a Self-Disciplining Device

S-Tier
Journal: Review of Economic Studies
Year: 2000
Volume: 67
Issue: 3
Pages: 529-544

Authors (2)

Score contribution per author:

4.022 = (α=2.01 / 2 authors) × 4.0x S-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We analyse the decision of an agent with time-inconsistent preferences to consume a good that exerts an externality on future welfare. The extent of the externality is initially unknown, but may be learned via a costless sampling procedure. We show that when the agent cannot commit to future consumption and learning decisions, incomplete learning may occur on a Markov perfect equilibrium path of the resulting intra-personal game. In such a case, each agent's incarnation stops learning for some values of the posterior distribution of beliefs and acts under self-restricted information. This conduct is interpreted as strategic ignorance. All equilibria featuring this property strictly Pareto dominate the complete learning equilibrium for any posterior distribution of beliefs.

Technical Details

RePEc Handle
repec:oup:restud:v:67:y:2000:i:3:p:529-544.
Journal Field
General
Author Count
2
Added to Database
2026-01-25