In the summer of 1998, three economists published an article in The Journal of Economic Perspectives entitled “Learning from the Behavior of Others: Conformity, Fads, and Informational Cascades.”17 Sushil Bikhchandani, David Hirshleifer, and Ivo Welch tried to explain why very different people often end up doing the same thing, such as wearing the same brand of shoes, watching the same television shows, or putting their money in Internet stocks. The key to such fads, the economists argued, is “social learning”—learning from the actions of others.
