Conflict and segregation in networks: An experiment on the interplay between individual preferences and social influence
AbstractWe examine the interplay between a person's individual preference and the social influence others exert. We provide a model of network relationships with conflicting preferences, where individuals are better off coordinating with those around them, but not all prefer the same action. We test our model in an experiment, varying the level of conflicting preferences between individuals. Our findings suggest that preferences are more salient than social influence, under conflicting preferences: subjects relate mainly with others who prefer the same. This leads to two undesirable outcomes: network segregation and social inefficiency. The same force that helps people individually hurts society.
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Bibliographic InfoPaper provided by University of Valencia, ERI-CES in its series Discussion Papers in Economic Behaviour with number 0114.
Date of creation: Jan 2014
Date of revision:
Heterogeneity; Social Networks; Formation; Equilibrium selection;
Find related papers by JEL classification:
- C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
- D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
This paper has been announced in the following NEP Reports:
- NEP-ALL-2014-03-15 (All new papers)
- NEP-CDM-2014-03-15 (Collective Decision-Making)
- NEP-EXP-2014-03-15 (Experimental Economics)
- NEP-GTH-2014-03-15 (Game Theory)
- NEP-LTV-2014-03-15 (Unemployment, Inequality & Poverty)
- NEP-NET-2014-03-15 (Network Economics)
- NEP-SOC-2014-03-15 (Social Norms & Social Capital)
- NEP-URE-2014-03-15 (Urban & Real Estate Economics)
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