Kellogg Podcast on Sunk Costs
Sandeep Baliga
Jeff Ely Microeconomic Theory, Game Theory, Behavioral Economics, Evolution
Non-partisan voters can become polarized not because of ideology but because it is optimal for them to remain uninformed and cancel out the votes of uninformed voters on “the other side.” Indeed, when stuck in such a state of polarization it is socially optimal to do so. Dynamics can lead an otherwise well-functioning assem- bly into irreversible polarization. Reputation effects might only make things worse.
Jeff Ely is the Charles E. and Emma H. Morrison Professor of Economics at Northwestern University and an accomplished latte-artist. He is the director of the Program in Mathematical Methods in the Social Sciences at Northwestern, a member of several editorial boards and co-author of the blog Cheap Talk.
Sandeep Baliga
The Wall Street Journal Numbers