| Abstract: |
Social interdependence is believed to play an important role in how people
make individual choices. This paper presents a simple model constructed on the
premise that people are motivated by their own payoff as well as by how their
actions compare with those of other people in their reference group. I show
that conformity of actions may arise either from learning about the norm
(social learning), or from adhering to the norm because of image-related
concerns (social influence). To disentangle the two empirically, I use the
fact that image-related concerns can be present only if actions are publicly
observable. The model predictions are tested in a "charitable contribution"
experiment in which the actions and identities of the subjects are unmasked in
a controlled and systematic way. Both social learning and social influence
seem to play an important role in the subjects' choices. In addition,
individuals gain utility simply by making the same choice as the reference
group (social comparison) and change their contributions in the direction of
the social norm even when their identities are hidden. Once the identities and
contribution distributions of group members are revealed, individuals conform
to the modal choice of the group. Moreover, I find that social ties (defined
as subjects knowing one another from outside the experimental environment)
affect the role of social influence. In particular, a low-contribution norm
evolves that causes individuals to contribute less in the presence of people
they know. |