Echenique, Federico and Shmaya, Eran (2007) You won't harm me if you fool me. Social Science Working Paper, 1281. California Institute of Technology , Pasadena, CA. http://resolver.caltech.edu/CaltechAUTHORS:20101008-110010257
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A decision maker faces a new theory of how certain events unfold over time. The theory matters for choices she needs to make, but possibly the theory is a fabrication. We show that there is a test which is guaranteed to pass a true theory, and which is also conservative: A false theory will only pass when adopting it over the decision maker’s initial theory would not cause substantial harm; if the agent is fooled she will not be harmed. We also study a society of conservative decision makers with different initial theories. We uncover pathological instances of our test: a society collectively rejects most theories, be they true or false. But we also find well-behaved instances of our test, collectively accepting true theories and rejecting false. Our tests builds on tests studied in the literature in the context of non-strategic inspectors.
|Item Type:||Report or Paper (Working Paper)|
|Additional Information:||From author's copy: We thank Wojciech Olszewski for a comment on a previous draft. Echenique thanks the NSF for its support through award SES-0751980 and the Lee Center at Caltech.|
|Group:||Social Science Working Papers|
|Subject Keywords:||Conservatism, Merging of Opinions, Testing Experts, Non-manipulation|
|Classification Code:||JEL classification numbers: C72,D83|
|Usage Policy:||No commercial reproduction, distribution, display or performance rights in this work are provided.|
|Deposited By:||Katherine Johnson|
|Deposited On:||08 Oct 2010 18:06|
|Last Modified:||26 Dec 2012 12:31|
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