Information Cascade Explaining Revolutions and Riots
http://www.voxeu.org/index.php?q=node/7156
In class we have learned how people form information cascades and how they are influenced
by other people’s decisions. This article explains how information cascades could explain social behaviors such as revolutions and riots.
Revolutions occur when a considerable amount of rebellions are gathered. During the process, information cascades are formed and people are influenced by other people’s decision. For instance, when some people rebel, others may follow thinking that their rebellion may be a sign of the regime’s weakness. More and more people start participating in the rebellion and finally when there are enough people, a successful revolution takes place. Since people’s participation is heavily based on other people’s decision, the effects and intentions of the revolution is not important in stimulating a revolution. People are initially unaware of the outcomes when they decide to rebel and sometimes a revolution could be a
complete mistake in the sense that everyone is worse off after it occurs.
Information cascades could also explain riots when we assume that potential criminals decide whether to commit crime rationally. They would have no moral conscience and decide to participate in criminal activity solely based on rational reasoning: balancing the expected benefits of committing crime against the costs, which depend on the probability of being punished and the severity of the actual punishment. This assumption would lead to two possible equilibrium outcomes one being a low-crime society in which the majority of people believe that criminal activity would most likely be caught and punished, and the other being a high-crime society in which the majority of people believe that criminal activity could get away without getting caught and punished. To see how information cascades explain riots, this article mentions the jump from low-crime to a high-crime state for a brief period in August and then a reversion back to the low-crime equilibrium in the United Kingdom. When police response to criminal activities and riots were lukewarm in London and this was
told to other potential rioters, they joined the riots as well and the police’s resources became even more stretched so the likelihood of being captured and punished for rioting dropped more and the information cascade of participating the riot became stronger. This cycle did not last long and was reversed when the police got more organized and became more successful in capturing and punishing rioters.
It was quite enlightening that information cascades could explain general social behaviors of the society such as revolutions and riots. We are in a world where information technologies develop exponentially and as the article comments, “We would argue that developments in information technologies, such as Twitter and Facebook, are likely to make such information cascades even more powerful,” information cascades are playing a bigger role in influencing social behavior even more.