Constructing Social Division to Support Cooperation: Theory and Evidence from Nepal
AbstractMany societies are divided into multiple smaller groups. The defining feature of these groups is that certain kinds of interaction are more likely to take place within a group than across groups. I build a model in which group divisions are enforced through a reputational penalty for interacting with members of different groups. Agents who interact with members of different groups find that they can support lower levels of cooperation in the future. The model explains why agents may be punished by the other members of their group for interacting with members of different groups and why agents are punished for interacting with members of some groups but not others. I test the empirical implication that there should be less cooperation among members of groups that make up a larger percentage of their communities. I discuss the origin and possible future of social division. JEL classification: Cooperation ; Caste ; Social Institution JEL codes: C7 ; O12 ; O17
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by University of Warwick, Department of Economics in its series The Warwick Economics Research Paper Series (TWERPS) with number 1011.
Date of creation: 2013
Date of revision:
Find related papers by JEL classification:
- C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
- O12 - Economic Development, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
- O17 - Economic Development, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-09-24 (All new papers)
- NEP-CDM-2013-09-24 (Collective Decision-Making)
- NEP-CWA-2013-09-24 (Central & Western Asia)
- NEP-EVO-2013-09-24 (Evolutionary Economics)
- NEP-GTH-2013-09-24 (Game Theory)
- NEP-NPS-2013-09-24 (Nonprofit & Public Sector)
- NEP-SOC-2013-09-24 (Social Norms & Social Capital)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Douglas Bernheim, B. & Ray, Debraj, 1989. "Collective dynamic consistency in repeated games," Games and Economic Behavior, Elsevier, vol. 1(4), pages 295-326, December.
- Kaivan Munshi & Mark Rosenzweig, 2006. "Traditional Institutions Meet the Modern World: Caste, Gender, and Schooling Choice in a Globalizing Economy," American Economic Review, American Economic Association, vol. 96(4), pages 1225-1252, September.
- Maurizio Mazzocco & Shiv Saini, 2012. "Testing Efficient Risk Sharing with Heterogeneous Risk Preferences," American Economic Review, American Economic Association, vol. 102(1), pages 428-68, February.
- Quy-Toan Do & Lakshmi Iyer, 2010. "Geography, poverty and conflict in Nepal," Journal of Peace Research, Peace Research Institute Oslo, vol. 47(6), pages 735-748, November.
- Akerlof, George A, 1976. "The Economics of Caste and of the Rat Race and Other Woeful Tales," The Quarterly Journal of Economics, MIT Press, vol. 90(4), pages 599-617, November.
- Grimard, Franque, 1997. "Household consumption smoothing through ethnic ties: evidence from Cote d'Ivoire," Journal of Development Economics, Elsevier, vol. 53(2), pages 391-422, August.
- Bisin, A. & Verdier, T., 1999.
"Beyond the Melting Pot : Cultural Transmission, Marriage, and the Evolution of Ethnic and Religious Traits,"
DELTA Working Papers
1999-10, DELTA (Ecole normale supérieure).
- Alberto Bisin & Thierry Verdier, 2000. ""Beyond The Melting Pot": Cultural Transmission, Marriage, And The Evolution Of Ethnic And Religious Traits," The Quarterly Journal of Economics, MIT Press, vol. 115(3), pages 955-988, August.
- Bisin, A. & Verdier, T., 1999. "Beyond the Melting Pot: Cultural Transmission, Marriage, and the Evolution of Ethnic and Religious Traits," Papers 1999-10, Laval - Laboratoire Econometrie.
- Avinash Dixit, 2003. "Trade Expansion and Contract Enforcement," Journal of Political Economy, University of Chicago Press, vol. 111(6), pages 1293-1317, December.
- Udry, Christopher, 1990. "Credit Markets in Northern Nigeria: Credit as Insurance in a Rural Economy," World Bank Economic Review, World Bank Group, vol. 4(3), pages 251-69, September.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Helen Neal).
If references are entirely missing, you can add them using this form.