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Journal Article•DOI•

Individual Behavior and Group Membership

Gary Charness1, Luca Rigotti2, Aldo Rustichini3•
University of California, Santa Barbara1, University of Pittsburgh2, University of Minnesota3
21 Dec 2006-Social Science Research Network-
TL;DR: In this paper, the saliency of group membership was investigated in two strategic games, the Battle of the Sexes and Prisoner's Dilemma, and it was shown that saliency affects the perception of the environment.
Abstract: People who are members of a group and identify with it behave differently from people who perceive themselves as isolated individuals. This difference depends on two main factors. First, preferences over outcomes change with the degree of identification with the group. Second, this identification depends on the saliency of the group structure. This paper tests these hypotheses and shows that group membership affects preferences over outcomes, and saliency of the group affects the perception of the environment. In two strategic environments, Battle of the Sexes and Prisoner's Dilemma, we create groups by allocating subjects to be Row or Column players. We manipulate the saliency of group membership by letting a player's own group watch as a passive audience as decisions are made, and by making part of the payoff common for members of the group. There is a strong and significant effect of group membership: It increases the aggressive stance of the hosts (people who have their group members in the audience), and reduces the one of the guests. The effect on outcomes depends on the game: In the Battle of the Sexes, the aggressiveness of hosts leads to more coordination; in the Prisoner's Dilemma, it leads to less cooperation. In the first case efficiency is increased, while in the second it is diminished. We also test for differences between in-group and out-group behavior in Prisoner's Dilemma games. In contrast to the minimal-group paradigm of the social-psychology literature, minimal groups do not affect behavior in our strategic environment. We see strong differences between in-group and out-group behavior only when we increase the saliency of group membership by having a degree of common payoffs.

Summary (1 min read)

Jump to: [INSTRUCTIONS (room R)] and [INSTRUCTIONS]

INSTRUCTIONS (room R)

  • They have been randomly divided into two rooms, each with 10 people.
  • These are actual dollars that will be paid in cash.
  • All people in the room (except for the person from the other room) will be able to watch the decider who belongs to their room make his or her choice (however, no verbal comments are permitted).
  • Your green numbers indicate the rounds during which it will be your turn to make a decision in the room where you are now (room R).

INSTRUCTIONS

  • Thank you for participating in this experiment.
  • There are 20 people participating in this session.
  • There will be 10 rounds in this session, and each person will make a decision in each round.
  • In some periods, you will be paired with someone in your color group, while in other periods you will be paired with someone in the other color group.
  • Each person will be making a simultaneous choice between A and B in the following decision matrix:.

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APPENDIX A: Instructions
(Prisoner’s Dilemma)
INSTRUCTIONS (room R)
Thank you for participating in this experiment. You will receive $5 for your participation, in addition to other
money to be paid as a result of decisions made in the experiment.
There are 20 people participating in this session. They have been randomly divided into two rooms, each with 10
people. You are in room R, this means you are a Row decider.
There will be ten rounds in this session
, and each person will make two decisions, one in each room. You have a
card with a green number and a card with a (different) yellow number. These numbers will determine when and
where you make decisions.
Your green number indicates the round during which it will be your turn to make a decision in the room where
you are now (room R).
Your yellow number indicates the round during which it will be your turn to go to the other room (room C) and
make a decision there.
In each round there are two people making a decision. Each person will be making a simultaneous choice between A
and B in the following decision matrix:
Column
A B
A 5 , 5 1 , 7
Row
B 7 , 1 2 , 2
In each cell, the first number represents the outcome for the Row decider and the second number represents the
outcome for the Column decider.
Thus, if both people choose A, the Row decider receives 5 and the Column decider receives 5. If both people choose
B, the Row decider receives 2 and the Column decider receives 2. If the Row decider chooses A and the Column
decider chooses B, the Row decider receives 1 and the Column decider receives 7. If the Row decider chooses B and
the Column decider chooses A, the Row decider receives 7 and the Column decider receives 1.
The other nine members of each room also have a financial stake in the outcome – each person not making a
decision receives 1/3 of the amount shown for the realized outcome.
Thus, if both deciders choose A, every inactive person in room R receives 5/3 and every inactive person from room
C receives 5/3. If both deciders choose B, every inactive person from room R receives 2/3 and every inactive person
from room C receives 2/3. If the Row decider chooses A and the Column decider chooses B, every inactive person
from room R receives 1/3 and every inactive person from room R receives 7/3. If the Row decider chooses B and the
Column decider chooses A, every inactive person from room R receives 7/3 and every inactive person from room R
receives 1/3.
Each unit is worth $0.50 in actual money (2 units = $1) that will be paid in cash at the end of the experiment.
All people in the room (except for the person from the other room) will be able to watch the decider who belongs to
their room make his or her choice (however, no verbal comments are permitted).
The decision of the person who walks into the room, on the other hand, is made privately.
2
The outcome of the joint decision is immediately revealed to all people in the room.
After the 10 rounds are completed, we will total each person’s earnings (from the outcomes of the two self-made
decisions, as well as the other 18 outcomes), add the $5 show-up fee, and pay each person individually and
privately, using the numbers on your two cards to identify your decisions.
Please feel free to ask questions.
3
(Battle of the Sexes)
INSTRUCTIONS (room R)
Thank you for participating in this experiment. You will receive $5 for your participation, in addition to other
money to be paid as a result of decisions made in the experiment.
There are 20 people participating in this session. They have been randomly divided into two rooms, each with 10
people. You are in room R, this means you are a Row decider.
There will be ten rounds in this session
, and each person will make two decisions, one in each room. You have a
card with a green number and a card with a (different) yellow number. These numbers will determine when and
where you make decisions.
Your green number indicates the round during which it will be your turn to make a decision in the room where
you are now (room R).
Your yellow number indicates the round during which it will be your turn to go to the other room (room C) and
make a decision there.
In each round there are two people making a decision. Each person will be making a simultaneous choice between A
and B in the following decision matrix:
Column
A B
A 3 , 1 0 , 0
Row
B 0 , 0 1 , 3
In each cell, the first number represents the outcome for the decider Row and the second number represents the
outcome for the decider Column.
Thus, if both people choose A, the decider Row receives $3 and the decider Column receives $1. If both people
choose B, the decider Row receives $1 and the decider Column receives $3. If non-identical letters are chosen, each
decider receives 0. These are actual dollars that will be paid in cash.
The other nine members of each room also have a financial stake in the outcome – each person not making a
decision receives 1/3 of the amount shown for the realized outcome.
Thus, if both deciders choose A, every person in room R receives $1 and every person in room C receives $1/3. If
both deciders choose B, every person in room R receives $1/3 and every person in room C receives $1. If non-
identical letters are chosen, everyone receives 0. These are also actual dollars that will be paid in cash.
All people in the room (except for the person from the other room) will be able to watch the decider who belongs to
their room make his or her choice (however, no verbal comments are permitted).
The decision of the person who walks into the room, on the other hand, is made privately.
The outcome of the joint decision is immediately revealed to all people in the room.
After the 10 rounds are completed, we will total each person’s earnings (from the outcomes of the two self-made
decisions, as well as the other 18 outcomes), add the $5 show-up fee, and pay each person individually and
privately, using the numbers on your two cards to identify your decisions.
Please feel free to ask questions.
4
(Battle of the Sexes: No Shared payoff)
INSTRUCTIONS (room R)
Thank you for participating in this experiment. You will receive $8 for your participation, in addition to other
money to be paid as a result of decisions made in the experiment.
There are 20 people participating in this session. They have been randomly divided into two rooms, each with 10
people. You are in room R, this means you are a Row decider.
There will be 20 rounds in this session
, and each person will make four decisions, two in each room. You have a two
card with green numbers and two cards with (different) yellow numbers. These numbers will determine when and
where you make decisions.
Your green numbers indicate the rounds during which it will be your turn to make a decision in the room where
you are now (room R).
Your yellow numbers indicate the rounds during which it will be your turn to go to the other room (room C) and
make a decision there.
In each round there are two people making a decision in each room. Each person will be making a simultaneous
choice between A and B in the following decision matrix:
Column
A B
A 3 , 1 0 , 0
Row
B 0 , 0 1 , 3
In each cell, the first number represents the outcome for the Row decider and the second number represents the
outcome for the Column decider.
Thus, if both people choose A, the Row decider receives 3 and the Column decider receives 1. If both people
choose B, the Row decider receives 1 and the Column decider receives 3. If the Row decider chooses A and the
Column decider chooses B, the Row decider receives 0 and the Column decider receives 0. If the Row decider
chooses B and the Column decider chooses A, the Row decider receives 0 and the Column decider receives 0. The
payment to the other people in the room is not affected by what the two people playing choose to do.
Each unit is worth $1 in actual money that will be paid in cash at the end of the experiment.
All people in the room (except for the person from the other room) will be able to watch the decider who belongs to
their room make his or her choice (however, no verbal comments are permitted).
The decision of the person who walks into the room, on the other hand, is made privately.
The outcome of the joint decision is immediately revealed to all people in the room.
After the 20 rounds are completed, we will total each person’s earnings and pay each person individually and
privately, using the numbers on your four cards to identify your decisions.
Please feel free to ask questions.
5
(Split audience)
INSTRUCTIONS (room R)
Thank you for participating in this experiment. You will receive $5 for your participation, in addition to other
money to be paid as a result of decisions made in the experiment.
There are 32 people participating in this session. They have been randomly divided into two rooms, each with 16
people. You are in room R, this means you are a member of the Row group.
Half of the people in this room will function as the audience and the other half of the people in this room will make
decisions. The people in the audience will remain in Room R, while the deciders will wait in another room until it is
time for their decisions.
There will be eight rounds in this session
, and each non-audience person will make two decisions, one in each room.
Such people will have a card with a green number and a card with a (different) yellow number. These numbers will
determine when and where they shall make decisions.
For the deciders:
The green number indicates the round during which it will be time to make a decision in the room where you are
now (room R).
The yellow number indicates the round during which it will be time to go to the other room (room C) and make a
decision there.
In each round there are two people making a decision in each room. Each person will be making a simultaneous
choice between A and B in the following decision matrix:
Column
A B
A 3 , 1 0 , 0
Row
B 0 , 0 1 , 3
In each cell, the first number represents the outcome for the decider Row and the second number represents the
outcome for the decider Column.
The other 15 members of each room also have a financial stake in the outcome – each person not making a decision
receives 1/3 of the amount shown for the realized outcome.
Thus, if both deciders choose A, the Row decider receives $3 and the Column decider receives $1; every non-
decider in the Row group receives $1 and every non-decider in the Column group receives $1/3. If both deciders
choose B, the Row decider receives $1 and the Column decider receives $3; every non-decider in the Row group
receives $1/3 and every non-decider in the Column group receives $1. If non-identical letters are chosen, everyone
receives 0. These are actual dollars that will be paid in cash.
Each person making a decision in the room will pass, face down, one of the decision cards to the experimenter, who
will reveal the choices when both cards have been passed. All people in the room will be able to observe the
outcome. However, no verbal comments are permitted at any time during the experiment.
After the eight rounds are completed, we will total each person’s earnings, add the $5 show-up fee, and pay each
person individually and privately, using the numbers on your two cards to identify your decisions. Audience
members receive an extra $1.
Please feel free to ask questions.
Citations
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Social Identity, Attitudes Towards Cooperation, and Social Preferences: Evidence from Switzerland

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Rustagi Devesh1, Marcella Veronesi2•
Goethe University Frankfurt1, University of Verona2
01 Jan 2016-Research Papers in Economics
TL;DR: In this article, the role of social identity in explaining individual variation in social preferences in the domain of cooperation is investigated, and it is shown that social identity matters also for attitudes towards cooperation.
Abstract: We investigate the role of social identity in explaining individual variation in social preferences in the domain of cooperation. We combine measures of social identity at both extensive and intensive margins with measures of social preferences elicited using a public goods game in the strategy method among a representative sample of Swiss households. We document a strong association between social identity and social preferences, which becomes stronger with the degree of social identity. Using different data sources, we show that social identity matters also for attitudes towards cooperation. Our results are not driven by differences in national or even local institutions, geography, historical, and economic conditions. Additional analyses show that grandparental and parental background shapes social identity, as well as social preferences. Our design allows us to go beyond behavior and disentangle social preferences from beliefs, highlighting the importance of social identity for deeper social preferences in a natural field setting.

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Altruism and the pressure to share: Lab evidence from Tanzania

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Salvatore Di Falco1, Razack Lokina2, Peter Martinsson3, Paolo Pin4, Paolo Pin5 •
University of Geneva1, University of Dar es Salaam2, University of Gothenburg3, Bocconi University4, University of Siena5
21 May 2019-PLOS ONE
TL;DR: The results indicate that sharing norms are crucial drivers of giving to other members of the network, and pressure to share has a detrimental effect on the undertaking of profitable but risky investments.
Abstract: We propose a novel laboratory experiment to document the pressure to share income within social networks in Africa. We find that the redistributive pressure exerted via the possibility of receiving a claim increases altruism, while the possibility of hiding from such claim reduces it. Our results indicate that sharing norms are crucial drivers of giving to other members of the network. We also find that pressure to share has a detrimental effect on the undertaking of profitable but risky investments.

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Group Outcomes And Reciprocity

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Christos A. Ioannou1, Shi Qi2, Aldo Rustichini3•
University of Southampton1, Florida State University2, University of Minnesota3
01 Jan 2011
TL;DR: This article showed that the role of social identity on motivating agents' decisions has been exaggerated, and that participants use group outcomes as a signal to coordinate in-group members on favorable outcomes.
Abstract: Group membership aects an agent’s individual behavior. We determine how, by testing two competing hypotheses. One is that group membership operates through social identity, and the other is that group membership implements a correlation among the actions of in-group members in response to an implicit signal. We introduce two novel features in the experimental design. The rst feature is the display of group outcomes. This allows us to assess directly the importance of relative group performance on subjects’ decisions. The second is a careful manipulation of the Dictator game and the Trust game. More specically, we choose parameters strategically so as to ensure no change in the pecuniary incentives across the two games. For a precise quantitative test of the two hypotheses we develop a structural model to describe an agent’s behavior across treatments. Our ndings suggest that the role of social identity on motivating agents’ decisions has been exaggerated. The display of group outcomes induces a group eect , but a careful analysis of this eect reveals that participants use group outcomes as a signal to coordinate in-group members on favorable outcomes. Furthermore, we nd evidence in support of recent experimental studies which demonstrate that an agent’s allocation choice is sensitive to the behavior of the agent that generated the choice set.

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Journal Article•DOI•
Group Status, Minorities and Trust

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Kei Tsutsui1, Daniel John Zizzo1•
University of East Anglia1
11 Sep 2010-Social Science Research Network
TL;DR: In this article, the authors present the results of an experiment that attempts to measure the impact of majority and minority groups, and high status and low status groups, on well-being, cooperation and social capital.
Abstract: We present the results of an experiment that attempts to measure the impact of majority and minority groups, and high status and low status groups, on well-being, cooperation and social capital. In the experiment, group membership is induced artificially, subjects interact with insiders and outsiders in trust games and periodically enter markets where they can trade group membership. We find that trust falls with groups because of discrimination against outsiders. Against this, however, there is evidence that low group status and minority subjects are less satisfied, and that low status subjects trust less other low status subjects.

6 citations

Cites background from "Individual Behavior and Group Membe..."

  • ...Do relative group size and social status affect the basic finding of intergroup discrimination found in HHZ, Yan Chen and Sherry Xin Li (2009), Gary Charness et al. (2007), and elsewhere?...

    [...]

  • ...For example, there is some evidence from experimental economics that membership in a group matters for individuals in the sense that it can affect their behavior in prisoner’s dilemma and battle of the sexes games (Gary Charness et al., 2007; Lorenz Goette et al., 2006), in the public goods game (e.g., Jonathan H. W. Tan and Friedel Bolle, 2007), in bargaining settings (Shaun P. Hargreaves-Heap and Yanis Varoufakis, 2002; Daniel J. Zizzo, 2003), two person sequential games (Yan Chen and Sherry Xin Li, 2009), trust games (Shaun P. Hargreaves Heap and Daniel J. Zizzo, 2009) and in coordination games (Roy Chen and Yan Chen, 2010)....

    [...]

  • ...…it is possible that stronger group manipulations may be required to obtain larger or different asymmetries in behavioral results; we know that in other settings the strength of group manipulation does affect behavioral findings (e.g., Gary Charness et al. 2007; Roy Chen and Yan Chen, 2010)....

    [...]

  • ...First, our group identity manipulation is minimal, and, while this is a good first step to allow interpretability, it is possible that stronger group manipulations may be required to obtain larger or different asymmetries in behavioral results; we know that in other settings the strength of group manipulation does affect behavioral findings (e.g., Gary Charness et al. 2007; Roy Chen and Yan Chen, 2010)....

    [...]

  • ...…in a group matters for individuals in the sense that it can affect their behavior in prisoner’s dilemma and battle of the sexes games (Gary Charness et al., 2007; Lorenz Goette et al., 2006), in the public goods game (e.g., Jonathan H. W. Tan and Friedel Bolle, 2007), in bargaining…...

    [...]

Journal Article•DOI•
Favoritism and Fairness in Teams

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Lu Dong, Lingbo Huang
06 Sep 2018-Games
TL;DR: It is found that most players allocate proportionally according to others’ relative contributions, irrespective of their social identity affiliations, when the money to be allocated depends on joint production.
Abstract: We experimentally study how people resolve a tension between favoritism and fairness when allocating a profit in a team production setting. Past research shows that people tend to favor their ingroup at the cost of an outgroup when allocating a given amount of money. However, when the money to be allocated depends on joint production, we find that most players allocate proportionally according to others’ relative contributions, irrespective of their social identity affiliations. We discuss the implications of our findings on how distributive norms could shape team cooperation.

6 citations

References
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An integrative theory of intergroup conflict

[...]

Henri Tajfel, John C. Turner1•
Australian National University1
01 Jan 2001

14,106 citations

Journal Article•DOI•
Rediscovering the social group: A self-categorization theory.

[...]

John C. Turner, Michael A. Hogg, Penelope J. Oakes, Stephen Reicher, Margaret Wetherell 
01 Jul 1989-Contemporary Sociology
TL;DR: In this paper, a self-categorization theory is proposed to discover the social group and the importance of social categories in the analysis of social influence, and the Salience of social Categories is discussed.
Abstract: 1. Introducing the Problem: Individual and Group 2. Rediscovering the Social Group 3. A Self-Categorization Theory 4. The Analysis of Social Influence 5. Social Identity 6. The Salience of Social Categories 7. Social Identity and Group Polarization 8. Crowd Behaviour as Social Action 9. Conclusion.

8,872 citations

Journal Article•DOI•
Africa's Growth Tragedy: Policies and Ethnic Divisions

[...]

William Easterly1, Ross Levine2•
World Bank1, University of Virginia2
01 Nov 1997-Quarterly Journal of Economics
TL;DR: This article showed that ethnic diversity helps explain cross-country differences in public policies and other economic indicators in Sub-Saharan Africa, and that high ethnic fragmentation explains a significant part of most of these characteristics.
Abstract: Explaining cross-country differences in growth rates requires not only an understanding of the link between growth and public policies, but also an understanding of why countries choose different public policies. This paper shows that ethnic diversity helps explain cross-country differences in public policies and other economic indicators. In the case of Sub-Saharan Africa, economic growth is associated with low schooling, political instability, underdeveloped financial systems, distorted foreign exchange markets, high government deficits, and insufficient infrastructure. Africa's high ethnic fragmentation explains a significant part of most of these characteristics.

5,648 citations

"Individual Behavior and Group Membe..." refers background in this paper

  • ...1 Some notable exceptions include Akerlof and Kranton (2000), Alesina et alii (2003), and Easterly and Levine (1997)....

    [...]

Book•
The Principles of Scientific Management

[...]

Frederick Winslow Taylor
01 Jan 1911
TL;DR: The Taylor System as discussed by the authors was developed as a system for increasing productivity in industry, and its principles have been applied to all kinds of large-scale enterprises, including operations with departments and agencies of the federal government.
Abstract: This brief essay by the founder of scientific management has served for nearly a century as a primer for administrators and for students of managerial techniques. Although scientific management was developed primarily as a system for increasing productivity in industry, its principles have been applied to all kinds of large-scale enterprises, including operations with departments and agencies of the federal government. It is in this volume that Frederick Winslow Taylor gave the theory of scientific management its clearest airing. Born in 1856, Taylor began work at age eighteen as an apprentice to a pattern-maker and as a machinist. A few years later he joined the Midvale Steel Company as a laborer, and in eight years rose to chief engineer. During this time he developed and tested what he called the "task system," which became known as the Taylor System and eventually as scientific management. He made careful experiments to determine the best way of performing each operation and the amount of time it required, analyzing the materials, tools, and work sequence, and establishing a clear division of labor between management and workers. His experiments laid the groundwork for the principles that are expounded in this essay, which was first published in 1911.

5,361 citations

Journal Article•DOI•
Economics and Identity

[...]

George A. Akerlof1, Rachel E. Kranton2•
University of California, Berkeley1, University of Maryland, College Park2
01 Aug 2000-Quarterly Journal of Economics
TL;DR: In this paper, the authors consider how identity, a person's sense of self, affects economic outcomes and incorporate the psychology and sociology of identity into an economic model of behavior, and construct a simple game-theoretic model showing how identity can affect individual interactions.
Abstract: This paper considers how identity, a person's sense of self, affects economic outcomes. We incorporate the psychology and sociology of identity into an economic model of behavior. In the utility function we propose, identity is associated with different social categories and how people in these categories should behave. We then construct a simple game-theoretic model showing how identity can affect individual interactions. The paper adapts these models to gender discrimination in the workplace, the economics of poverty and social exclusion, and the household division of labor. In each case, the inclusion of identity substantively changes conclusions of previous economic analysis.

4,825 citations

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Frequently Asked Questions (1)
Q1. What are the contributions in this paper?

In this paper, if both people choose A, the Row decider receives 5 and the Column deciders receives 5.