Information Cascade in Politics
Information cascade happens everywhere. Even in politics. Chris Ellis and John Fender, economics professors from the University of Oregon and the University of Birmingham, relate the idea of information cascade with the occurrence of threat of revolution. Especially, they developed a theory of political regime change brought about by the threat of revolution.
From the lecture, we learned that an information cascade is where people make decisions on the basis of their observations of other people’s actions. Information cascade takes place before revolution happens, according to Ellis and Fender. Workers decide whether or not to rebel by observing other workers’ behavior and by observing any signals that they may receive about the state of the regime. It means that if other people decide to rebel, others are more likely to choose to rebel as well even though their personal thoughts may be different from what most people think. If enough people rebel, therefore, there is a successful revolution and rulers are overthrown. Leaders of the euro-zone countries meet in order to prevent a cascade imparting negative information about the value of government debt in southern European economies. For them, it is important to prevent information cascade from taking place amongst the public so that they are not overthrown. It is interesting how political theory involves the idea of information cascade and how rulers of countries use the theory for their benefits.
Link: http://www.economist.com/blogs/democracyinamerica/2011/10/mass-movements