When to Favour Your Own group? The Threats of Costly Punishments and In-group Favouritism
AbstractUsing a laboratory experiment with minimal groups, we examined the extent to which the threats of costly punishments affect in-group favouritism behaviour. We studied three types of punishment separately: in-group, out-group, and third-party punishments. In line with previous studies, the majority of the allocators favoured their own group by allocating more money to each of the in-group members at the expense of the out-group in the baseline without punishment. In the in-group punishment treatment, we observed a slight increase in in-group favouritism behaviour. On the contrary, when only the out-group could punish the allocators, there was a significant drop in in-group favouritism behaviour as well as an increase in the equal division option. Finally, when faced with an independent third-party punisher the allocators continued to favour their own group. The threat of third-party punishment appeared to have no effect on their decisions. Our paper contributes to the literature on in-group favouritism and the nature of social norms by showing that the decision whether to favour oneâ€™s own group is affected by the threats of in-group and out-group punishments and whether it leads to an increase or decrease in this behaviour depends on who has the punishment power. Parochial or in-group biased norm was enforced by the in-group members, whilst â€˜egalitarian sharing normâ€™ (across groups) was enforced by the out-group members. We conclude firstly that people apply different â€˜self-servingâ€™ social norms depending on their own group identity. Secondly, unlike selfish or opportunistic behaviours, independent third-parties, who only observed this behaviour but were not directly affected by it, were not willing to punish this behaviour.�
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Bibliographic InfoPaper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number 628.
Date of creation: 02 Nov 2012
Date of revision:
In-group favouritism; Group behaviour; Social identity; Social norm; In-group punishment; Out-group punishment; Third-party punishment; Favour game;
Find related papers by JEL classification:
- D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
- D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
- C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-02-03 (All new papers)
- NEP-CBE-2013-02-03 (Cognitive & Behavioural Economics)
- NEP-CDM-2013-02-03 (Collective Decision-Making)
- NEP-EVO-2013-02-03 (Evolutionary Economics)
- NEP-EXP-2013-02-03 (Experimental Economics)
- NEP-POL-2013-02-03 (Positive Political Economics)
- NEP-SOC-2013-02-03 (Social Norms & Social Capital)
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