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Journal Article•DOI•

Nationalism, cognitive ability, and interpersonal relations

Giacomo Corneo
15 Apr 2010-International Review of Economics (Springer-Verlag)-Vol. 57, Iss: 2, pp 119-141
TL;DR: The authors developed a model of how those judgments form based on a theory of symbolic values, which depicts the interaction between two values, one associated with an inherited ethnic trait (nationality) and one with an endogenous achievement trait (income) and found that individuals with lower cognitive ability are predicted to invest more value on nationalism and to have hostile relations with immigrants.
Abstract: Interpersonal relations are shaped by the judgements associated with the social categories that individuals perceive in their social contacts. I develop a model of how those judgments form based on a theory of symbolic values. The model depicts the interaction between two values, one associated with an inherited ethnic trait (“nationality”) and one with an endogenous achievement trait (“income”). Individuals with lower cognitive ability are predicted to invest more value on nationalism and to have hostile relations with immigrants. Multiple equilibria are possible, and better schooling may eliminate equilibria with xenophobia. Econometric findings based on data from three large surveys corroborate the predictions derived from the theoretical model.

Summary (3 min read)

Jump to: [1 Introduction] – [2 Theory of symbolic values] – [3 A model of immigrants-natives relations] – [3.1 Assumptions] – [3.2 Individual optimization] – [3.3 General equilibrium] – [3.4 Predictions for nationalism] – [4 Corroborating evidence] – [4.1 German youth] – [4.2 ISSP] – [4.3 WVS] and [5 Conclusion]

1 Introduction

  • Interpersonal relations have an idiosyncratic and a common component.
  • First encounters1 are governed by the expectations and judgements associated with the social categories - like gender, race, and occupation - that individuals perceive in their social contacts.
  • They nd that "compositional amenities" - associated with the non-economic consequences of immigration - are substantially more important in explaining attitudes than concerns over the impacts of immigration on wages and taxes.
  • When parents choose how much value they put on economic success and national pride, they compare the bene ts that those values confer upon their children with the costs of instilling values.
  • Sect. 3 applies that theory to nationalism, studies the relations between natives and immigrants, and shows the causal e¤ect of ability on nationalism.

2 Theory of symbolic values

  • Some personal characteristics, like nationality and level of income, seem to be invested with symbolic values by human beings.
  • The theory of symbolic values developed in Corneo and Jeanne (2009, 2010) is based on four main assumptions: 2 1) Evaluative attitude.
  • Individuals pass judgments of approval, admiration, etc., and their opposite upon certain traits, acts, and outcomes.
  • Those judgements are determined by an individual s value system, which is a way to allocate value to bundles of judgeable characteristics.
  • Bisin and Verdier (1998, 2000) combined purposive socialization with an evolutionary approach.

3 A model of immigrants-natives relations

  • Beliefs in the superiority of one s own ethnicity can have serious implications for the relations between immigrants and natives and for a country s economic performance.
  • Immigrants constitute a sizeable share of the overall world population and often belong to the most vulnerable strata of the population.
  • Natives hostility may foster negative stereotyping by immigrants with respect to the national majority, giving rise to a mental arm race in terms of prejudices.
  • That arm race can a¤ect political outcomes and even turn into episodes of violence.
  • Xenophobia may generate a lasting negative impact on innovation and economic growth.

3.1 Assumptions

  • Individuals have a common utility function but di¤er with respect to their nationality, ability, and family background.
  • The model in the current paper can also be interpreted as one of racial relations.
  • Ability is determined by exogenous factors, like inherited family traits and the quality of compulsory schooling received by the child.
  • Secondly, parents incur a speci c cost for manipulating the value attached to each single trait, achievement and nationality.
  • The preference parameters and are strictly positive; they respectively capture the strength of the concern for self-esteem and for the quality of interpersonal relations.

3.2 Individual optimization

  • At the family level, both the wage structure and the allocation of social esteem are taken as exogenouos.
  • Second, individuals may be assumed to have a higher probability to meet somebody of the same nationality.
  • The immigrants decision problem is similar and will not be explicitly presented.
  • The 7This result accords well with empirical ndings from wage regressions reported by Fortin (2008).
  • Increasing the achievement-orientation of the child generates an incentive to exert more e¤ort because the achievement orientation increases the loss of self-esteem in case of failure.

3.3 General equilibrium

  • At the general-equilibrium level, the income levels of achievers and losers and the social esteem of each type are endogenous.
  • The wage determination follows the usual logic of scarcity: the wage di¤erential is given by w = wH ((1 )ba+ ea) wL((1 )ba+ ea); which is decreasing in the fraction of achievers in the two groups, ba and ea.
  • The following fact can be established: Proposition 2 A general equilibrium always exists.
  • More precisely, an increase of achievement orientation for some children increases the social esteem received by achievers as compared to losers; this strengthens the incentive for other children to exert e¤ort, hence their probability to succeed increases.
  • In case of multiple stable equilibria, a low-achievementorientation, low-e¤ort equilibrium coexists with a high-achievement-orientation, highe¤ort equilibrium.

3.4 Predictions for nationalism

  • While natives and immigrants could have similar incentives to shape values about achievement, they have diametrically opposed incentives with respect to nationalism.
  • The following result is stated for natives and an equivalent one holds true for immigrants.
  • This e¤ect is also at work if parents want to de-emphasize economic success, which is what happens in con gurations 1 and 2.
  • In con gurations 2, 3 and 4 the e¤ect from is qualitatively identical to the one from .

4 Corroborating evidence

  • The theoretical model suggests that ability is an explanatory factor of nationalistic attitude.
  • Answers to that question are used to determine the value of the dependent variable in econometric regressions.
  • In empirical work, cognitive ability is usually measured by scholastic achievement tests, which, unfortunately, are not part of the datasets that contain the nationalism variable.
  • As an indicator of latent cognitive ability, I use educational attainment which, depending on the dataset, is measured by three to six school degrees.

4.1 German youth

  • About 20,000 young adults aged 16-29 were interviewed and the survey was designed to be representative of the total German population in that age range.
  • To some extent, school degrees are likely to be a¤ected by values instilled by parents.
  • In the samples used, the coe¢ cient of correlation between low education and age never exceeds in absolute value .13 and the one between high education and age never exceeds .
  • As a robustness check, regressions were run only considering individuals who are older than twenty and only considering individuals who are at least twenty-two.
  • The results show that educational attainment has a strongly signi cant impact on the degree of nationalism of the German youth.

4.2 ISSP

  • The "National Identity 2003" module of the International Social Survey Programme (ISSP) covers most OECD countries; it samples about 45,000 adult individuals.
  • An advantage of this data source as compared to the DJI Survey is that educational attainment is more nely coded according to the following six categories: "No education"; "Primary education", "Some secundary education", Secundary education", "Above secundary education", "Tertiary education".
  • Regression results are exhibited in Table 3.
  • All regressions include unreported country dummies; standard errors are adjusted for clustering by country of the respondent.
  • At even lower attainments ("No education") there is no statistically signi cant e¤ect of education on nationalism, i.e. the nationalism of individuals with no education seems to be closer to that of individuals with some secundary education than to that of individuals with only primary education.

4.3 WVS

  • The distinctive advantage of this source is that it includes many developing countries where educational attainment is relatively low; the sample has more than 250,000 observations.
  • In this data source there is a survey question directly related to the relative value assigned to the respondent s country.
  • Furthermore, socialization may have taken place behind a veil of ignorance, i.e. before deciding to migrate; this may also imply a lower degree of nationalism for children of foreign parents.
  • Table 5 presents regression results when parent s immigrant status is controlled for.
  • Among all datasets and speci cations examined in this paper, this is the one that delivers the strongest support for the increasing part of the relationship between ability and nationalism put forward by the theoretical model.

5 Conclusion

  • Interpersonal relations are embedded in the judgements associated with the social categories that individuals perceive in their fellow human beings.
  • Using that theoretical framework, I have developed a simple model of relations between natives and immigrants where value of own nationality and disvalue of di¤erent ethnicity are endogenously determined.
  • Such an investment is predicted to induce parents of children with relatively low cognitive ability to increase their noncognitive abilities by enhancing their achievement orientation, at the same time avoiding to boost their self-esteem through feelings of national or racial superiority.
  • QED 24 Proof of Proposition 2: Equilibrium existence follows from standard theorems of existence of Nash equilibrium for nonatomic games, see e.g. Rath (1992).
  • Parameter restrictions are only required to ensure that a = 0, also known as Con guration 3.

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Nationalism, Cognitive Ability, and Interpersonal
Relations
Giacomo Corneo
School of Business & Economics
Discussion Paper
Economics
2010/5
978-3-941240-17-9
Nationalism, Cognitive Ability, and Interpersonal Relations
Giacomo Corneo
March, 2010
This article builds on a keynote lecture that I delivered at the conference "Happiness and relational
goods: Well-being and interpersonal relations in the economic sphere" in Venice, June 12, 2009. I thank
an anonymous referee and Benedetto Gui for detailed comments as well as Holger Lüthen and Frank
Neher for excellent research assistance.
A¢ liation of author: Department of E conomics , Free University of Berlin; CEPR, London; CESifo,
Munich ; IZA, Bonn.
Address of author: Department of Economics, FU Berlin, Boltzmannstr. 20, 14195 Berlin, Germany.
Email: giacomo.corneo@.fu-berlin.de.
Abstract
Interpersonal relations are shaped by the judgements associated with the social cate-
gories that individuals perceive in their social contacts. I develop a model of how those
judgments form based on a theory of symbolic values. The model depicts the interac-
tion between two values, one associated with an inherited ethnic trait ("nationality") and
one with an endogenous achievement trait ("income"). Individuals with lower cognitive
ability are predicted to invest more value on nationalism and to have hostile relations
with immigrants. Multiple equilibria are possible and better schooling may eliminate
equilibria with xenophobia. Econometric …ndings based on data from three large surveys
corroborate the predictions derived from the theoretical model.
Keywords: nationalism, xenophobia, interpersonal relations, value systems.
JEL-Classi…cation: Z1.
1 Introduction
Interpersonal relations have an idiosyncratic and a common component. On the one hand,
any interpersonal relation is the product of a unique history of interactions between con-
crete human beings and of their memories of that history. On the other hand, interper-
sonal relations unfold in a socially constructed mental frame: individuals encounter each
other as carriers of traits whose saliency and meaning are to a large extent socially deter-
mined. People …rst meet as men and women, white and black, subordinate and boss, and
only after - if their communication deepens - as individualized persons. First encounters
1
are governed by the expectations and judgements associated with the social categories
- like gender, race, and occupation - that individuals perceive in their social contacts.
Those judgements heavily a¤ect the utility derived from interpersonal relations. They
may determine whether a …rst encounter begins with a smile or with raised eyebrows,
with deference or disdain, with a handshake or an erected …nger. And the quality of a
…rst encounter may determine whether the relation continues and on which track. Since
social judgments carry such heavy consequences, people’s search for personal contacts as
well as their e¤orts to avoid them, along with the resulting network of relations, depend
on the prevailing stereotypes associated with social categories.
This paper considers the case where people’s evaluation of social categories are a matter
of choice. Based on a theory of symbolic values proposed by Corneo and Jeanne (2009,
2010), I explore the extent to which parents interested in their children’s welfare will teach
them to believe in the superiority of their own nation and to despise immigrants. The
model o¤ers an explanation for the emergence of xenophobia without positing adverse
economic e¤ects of immigration for natives. Thus, it conforms well with recent empirical
…ndings by Card et al. (2009) on the determinants of attitudes towards immigration in
Europe. They …nd that "compositional amenities" - associated with the non-economic
consequences of immigration - are substantially more important in explaining attitudes
than concerns over the impacts of immigration on wages and taxes. Those amenity e¤ects
are found to be especially strong in case of less-educated natives.
The model in this paper captures the idea that parents try to transmit values that serve
best their children’s interest both in terms of their economic welfare and self-esteem. By
stressing the importance of economic success, parents make their children more willing to
exert work e¤ort and increase the probabililty that they will eventually reach a high income
1
Gui (2005) introduced this terminology to describe those peculiar acts of produ ction and consumption
that characterize interpersonal relations from an economic viewpoint.
1
level. However, economic success is uncertain and stressing economic success carries the
risk of a loss of self-esteem in case of bad luck. Teaching pride in own nation is an easy way
to sustain one’s self-esteem without risk. When parents cho ose how much value they put
on economic success and national pride, they compare the bene…ts that those values confer
upon their children with the costs of instilling values. That trade-o¤ turns out to hinge
upon the ability of children - because higher ability increases the probability to have a
high income. The model predicts that above a certain threshold, nationalism is decreasing
with individual ability. Parents of high-ability children expect them to be successful with
high probability; for them it is optimal to strenghten the achievement orientation of their
children thereby increasing further the probability of success and at the same time raising
the probability of a high level of self-esteem. Since a heavier investment in achievement
orientation increases the marginal cost of further so cializing their children, parents of
high-ability children optimally decrease their investment in national pride. Conversely,
parents of low-ability children anticipate a low probability of economic success and prefer
to instill nationalism so as to secure at least some self-esteem to their children. Analysis
of this trade-o¤ for very low levels of ability reveals that the opposite pattern - where
nationalistic attitudes are increasing with ability - can also exist. In the general case, the
relationship between nationalism and ability is therefore hump-shaped.
This paper proceeds as follows. In Sect. 2, I sketch the main ideas of the theory
of symbolic values developed by Corneo and Jeanne (2009 and 2010). Sect. 3 applies
that theory to nationalism, studies the relations between natives and immigrants, and
shows the causal e¤ect of ability on nationalism. In Sect. 4, the model’s prediction are
confronted with empirical evidence obtained from three large representative surveys. Sect.
5 concludes.
2 Theory of symbolic values
Some personal characteristics, like nationality and level of income, seem to be invested
with symbolic values by human beings. These values determine the esteem that individ-
uals receive from other people as well as their self-esteem. Those values are symb olic in
the sense that they are intangible: they a¤ect the well-being of individuals - so they are
values - but without a¤ecting their consumption of material goods - so they are symbolic.
A system of symbolic values is a set of judgments about salient characteristics. A theory
of symbolic values should explain the variation of those judgments across so cial groups
and single individuals. The theory of symbolic values developed in Corneo and Jeanne
(2009, 2010) is based on four main assumptions:
2
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Frequently Asked Questions (10)
Q1. What are the contributions in "Nationalism, cognitive ability, and interpersonal relations" ?

This paper developed a model of how those judgments form based on a theory of symbolic values, which depicts the interaction between two values, one associated with an inherited ethnic trait ( `` nationality '' ) and one with an endogenous achievement trait ( `` income '' ). 

The desired ways of thinking may be in a scale that distinguishes contempt, indi¤erence, interest, approval, praise, admiration, and veneration. 

The novel idea put forward by the model is that investing resources to increase the cognitive ability of low-ability natives may improve the integration of immigrants in society. 

First encounters1 are governed by the expectations and judgements associated with the social categories - like gender, race, and occupation - that individuals perceive in their social contacts. 

Partly because of di¢ culties in precisely measuring those values, the empirical literature on school outcomes is of limited help in assessing how severe this problem is. 

Three datasets are considered: the German DJI Youth Survey, the "National Identity 2003" module of the International Social Survey Programme (ISSP), and the World Value Survey (WVS). 

The relevant human environment for approbativeness may be an individual s family, friends, colleagues, neighbors, or society at large. 

As a robustness check, regressions were run only considering individuals who are older than twenty and only considering individuals who are at least twenty-two. 

22APPENDIXProof of Proposition 1: Since parents and children s interests are perfectly aligned and their information sets are identical, an agent s optimal strategy simply is to maximize (5) with respect to the three control variables e, n and a. 

According to Proposition 3, there is an inverted-U relationship between the two variables: there can exist ability levels that are so low that nationalism increases with ability but as soon as some intermediate ability level is reached, nationalism is predicted to decrease with ability.