Attention and Social Learning

Abstract

In an incentivized laboratory experiment, we study how people account for and respond to others' incentives for paying attention. Participants learn a binary state from an attention task under high or low accuracy incentives. We ask subjects to predict their peers' accuracy based on the peers' incentives and to aggregate answers from multiple peers with different incentives. Most subjects fail to consistently understand that peers with stronger incentives are more accurate, and these subjects also perform worse in individual attention tasks. Subjects also participate in a social-learning task where they first learn the binary state from an attention task, then observe a peer's guess about the state in the same task, and finally make a guess themselves. We find behavior in these tasks is inconsistent with leading models of flexible costly information acquisition. In particular, subjects fail to pay more attention when paired with lower incentive peers. Overall, we find that many decision-makers do not respond to others' incentives for accuracy even when those incentives are transparent.