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Preferences for Consistency

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  • Armin Falk
  • Florian Zimmermann

Abstract

This paper studies how a preference for consistency can affect economic decision-making. We propose a two-period model where people have a preference for consistency because consistent behavior allows them to signal personal and intellectual strength. We then present three experiments that study main predictions and implications of the model. The first is a simple principal-agent experiment that shows that consistency is valued by others and that this value is anticipated. The second experiment underlines the crucial role of early commitment for consistency preferences. Finally we show how preferences for consistency can be used to manipulate choices.

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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 3528.

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Date of creation: 2011
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Handle: RePEc:ces:ceswps:_3528

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Keywords: consistency preferences; experiments; early commitment; charitable giving; social influence;

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References

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  1. Roland Bénabou & Jean Tirole, 2005. "Incentives and Prosocial Behavior," NBER Working Papers 11535, National Bureau of Economic Research, Inc.
  2. In-Koo Cho & David M. Kreps, 1997. "Signaling Games and Stable Equilibria," Levine's Working Paper Archive 896, David K. Levine.
  3. Grether, David M., . "Bayes Rule as a Descriptive Model: The Representativeness Heuristic," Working Papers, California Institute of Technology, Division of the Humanities and Social Sciences 245, California Institute of Technology, Division of the Humanities and Social Sciences.
  4. Mullainathan, Sendhil & Washington, Ebonya, 2007. "Sticking with Your Vote: Cognitive Dissonance Voting," Working Papers, Yale University, Department of Economics 14, Yale University, Department of Economics.
  5. Roland Benabou and Jean Tirole, 2004. "Willpower and Personal Rules," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 112(4), pages 848-886, August.
  6. Akerlof, George A & Dickens, William T, 1982. "The Economic Consequences of Cognitive Dissonance," American Economic Review, American Economic Association, American Economic Association, vol. 72(3), pages 307-19, June.
  7. Dohmen, Thomas J. & Falk, Armin & Huffman, David & Marklein, Felix & Sunde, Uwe, 2009. "Biased probability judgment: Evidence of incidence and relationship to economic outcomes from a representative sample," Munich Reprints in Economics, University of Munich, Department of Economics 20042, University of Munich, Department of Economics.
  8. Tore Ellingsen & Magnus Johannesson, 2004. "Promises, Threats and Fairness," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 114(495), pages 397-420, 04.
  9. Bernheim, B Douglas, 1994. "A Theory of Conformity," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 102(5), pages 841-77, October.
  10. Greiner, Ben, 2004. "An Online Recruitment System for Economic Experiments," MPRA Paper 13513, University Library of Munich, Germany.
  11. Prendergast, Canice & Stole, Lars, 1996. "Impetuous Youngsters and Jaded Old-Timers: Acquiring a Reputation for Learning," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 104(6), pages 1105-34, December.
  12. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, Springer, vol. 10(2), pages 171-178, June.
  13. Tore Ellingsen & Magnus Johannesson, 2008. "Pride and Prejudice: The Human Side of Incentive Theory," American Economic Review, American Economic Association, American Economic Association, vol. 98(3), pages 990-1008, June.
  14. James Andreoni & B. Douglas Bernheim, 2007. "Social Image and the 50-50 Norm: A Theoretical and Experimental Analysis of Audience Effects," Discussion Papers, Stanford Institute for Economic Policy Research 07-030, Stanford Institute for Economic Policy Research.
  15. Brown, Martin & Falk, Armin & Fehr, Ernst, 2003. "Relational Contracts and the Nature of Market Interactions," IZA Discussion Papers 897, Institute for the Study of Labor (IZA).
  16. Gary Charness & Dan Levin, 2005. "When Optimal Choices Feel Wrong: A Laboratory Study of Bayesian Updating, Complexity, and Affect," American Economic Review, American Economic Association, American Economic Association, vol. 95(4), pages 1300-1309, September.
  17. Christoph Vanberg, 2008. "Why Do People Keep Their Promises? An Experimental Test of Two Explanations -super-1," Econometrica, Econometric Society, Econometric Society, vol. 76(6), pages 1467-1480, November.
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Citations

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Cited by:
  1. Ewers, Mara & Zimmermann, Florian, 2012. "Image and Misreporting," IZA Discussion Papers 6425, Institute for the Study of Labor (IZA).
  2. Dessi, Roberta & Monin, Benoît, 2012. "Noblesse Oblige? Moral Identity and Prosocial Behavior in the Face of Selfishness," TSE Working Papers, Toulouse School of Economics (TSE) 12-347, Toulouse School of Economics (TSE).
  3. Gerrit Frackenpohl & Gert Pönitzsch, 2013. "Bundling Public with Private Goods," Bonn Econ Discussion Papers, University of Bonn, Germany bgse05_2013, University of Bonn, Germany.
  4. Bo Chen, 2013. "Assignment Games with Externalities And Matching-Based Competition," Bonn Econ Discussion Papers, University of Bonn, Germany bgse08_2013, University of Bonn, Germany.
  5. Dessi, Roberta & Monin, Benoît, 2012. "Noblesse Oblige? Moral Identity and Prosocial Behavior in the Face of Selfishness," IDEI Working Papers, Institut d'Économie Industrielle (IDEI), Toulouse 750, Institut d'Économie Industrielle (IDEI), Toulouse.
  6. Sebastian Goerg & Sebastian Kube, 2012. "Goals (th)at Work – Goals, Monetary Incentives, and Workers’ Performance," Working Paper Series of the Max Planck Institute for Research on Collective Goods, Max Planck Institute for Research on Collective Goods 2012_19, Max Planck Institute for Research on Collective Goods.

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