Information cascade
Etymology
The concept was formalized by economists Bikhchandani, Hirshleifer, and Welch in a 1992 paper. “Cascade” from Latin “cadere” (“to fall”), evoking a chain of downward steps: once enough people have chosen, the next person infers they must know something and follows suit.
noun phrase · /in-fer-MAY-shun kas-KADE/
A situation where people ignore their own information and copy the choices of those before them, so a decision snowballs.
What it names
Names how rational imitation can lock a crowd into a choice — a restaurant, a stock, a rumor — on the basis of little real evidence.
Example
Diners pick the busier of two empty-looking restaurants, and the crowd grows through an information cascade even if the food is worse.
Related idea
An information cascade spreads by people inferring from others’ actions; herd behavior is the broader label for moving as a group, and pluralistic ignorance is the trap where everyone privately doubts what the group seems to accept.