Robust Information Cascade with Endogenous Ordering

We analyze a sequential decision model with one-sided commitment in which decision makers are allowed to choose the time of acting (exercising a risky investment option A) or waiting. We characterize information cascade under endogenous ordering and show that with endogenous ordering, if the number of decision makers is large and decision makers are patient enough, at any fixed time, nearly all decision makers wait due to the negligible information disclosed. In this case, if decision makers can be forced to move with an exogenous order, the resulting equilibrium is more efficient because exogenous ordering tends to aggregate more information. JEL classification: C73, D62, D71, D81, D83