Collective Progress: Dynamics of Exit Waves

Doruk Cetemen; Can Urgun; Leeat Yariv

doi:10.3386/w29008

Collective Progress: Dynamics of Exit Waves

Doruk Cetemen, Can Urgun & Leeat Yariv

Working Paper 29008

DOI 10.3386/w29008

Issue Date July 2021

We study a model of collective search by teams. Discoveries beget discoveries and correlated search results are governed by a Brownian path. Search results' variation at any point---the search scope---is jointly controlled. Agents individually choose when to cease search and implement their best discovery. We characterize equilibrium and optimal policies. Search scope is constant and independent of search outcomes as long as no member leaves. It declines after departures. A simple drawdown stopping boundary governs each agent’s search termination. We show the emergence of endogenous exit waves, whereby possibly heterogeneous agents cease search all at once.

We thank Arjada Bardhi, Alessandro Bonatti, Francesc Dilme, Hari Govindan, Faruk Gul, Toomas Hinnosaar, Alessandro Lizzeri, Chiara Margaria, Pietro Ortoleva, Wolfgang Pesendorfer, and Heikki Rantakari for helpful comments and suggestions. We also thank seminar audiences at Central European University, Collegio Carlo Alberto, Princeton, Seoul National University, Tel-Aviv University, UCLA, University of Rochester, and VSET. Yariv gratefully acknowledges financial support from the National Science Foundation through grants SES-1629613 and SES-1949381. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.
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Collective Progress: Dynamics of Exit Waves

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