Consumers often consult the reviews of their peers before deciding whether to purchase a new experience good; however, their initial quality expectations are typically set by the product's observable attributes. This paper focuses on the implications of social learning for a monopolist firm's...

We study observational learning in environments where customers choose among multiple options with uncertain quality for which they observe the aggregate choices of previous customers (the sales of each option). When customers have heterogeneous knowledge about quality, the choices of better...