Categorical Cognition: A Psychological Model of Categories and Identification in Decision Making
AbstractThis paper introduces a psychological notion of categorization into economics and derives its implications for economic decision making. We show, using a tractable model of social cognition, that a decision maker in (efficiently) assigning past experiences to categories, will sort experiences of interaction with larger (majority) groups more finely than experiences with smaller (minority) groups. We then apply the model to understand simple forms of discrimination and social identity. It is shown that discrimination in hiring can result from such cognitive processes even when there is no malevolent taste to do so and workers' qualifications are fully observable. The model also provides a framework that is equipped to investigate the social psychological
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Date of creation: 04 Nov 2002
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categorization; discrimination; bounded rationality;
Other versions of this item:
- Roland G. Fryer, Jr. & Matthew O. Jackson, 2003. "Categorical Cognition: A Psychological Model of Categories and Identification in Decision Making," NBER Working Papers 9579, National Bureau of Economic Research, Inc.
- Jackson, Matthew O. & Fryer Jr., Roland G., 2002. "Categorical Cognition: A Psychological Model of Categories and Identification in Decision Making," Working Papers 1144, California Institute of Technology, Division of the Humanities and Social Sciences.
- D10 - Microeconomics - - Household Behavior - - - General
- D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General
- I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
- J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
- J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
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