Conformity and adaptation in groups

G. Bose,E. Dechter,L. Ivancic

Published 2023 in Journal of Economic Behavior & Organization

ABSTRACT

We construct a simple model of norm-referenced behaviour for agents interacting within a broader group, and conduct a laboratory experiment to examine its predictions. Agents receive disutility (utility) if they act more selfishly (generously) towards others than is the norm, as well as if they accept more selfish (generous) behaviour from others. With heterogeneous agents, the equilibrium distribution of behaviours within a group is non-degenerate. Further, when agents move between groups, their behaviour adapts accordingly. The experimental results confirm these predictions, and suggest that individual behaviour can be explained as the interaction between innate selfishness-aversion and the external social environment.

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