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Changing Identity: The Emergence of Social Groups

  • Ulrich Horst

    ()

    (Université Humboldt de Berlin - Humboldt - University of Berlin)

  • Alan Kirman

    ()

    (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - Université de la Méditerranée - Aix-Marseille II - Université Paul Cézanne - Aix-Marseille III - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - CNRS : UMR6579)

  • Miriam Teschl

    (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - Université de la Méditerranée - Aix-Marseille II - Université Paul Cézanne - Aix-Marseille III - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - CNRS : UMR6579, Robinson College - University of Cambridge)

Homo Economicus has progressed from an atomistic and self-interested individual in standard economics to a socially embedded agent in modern economics who is endowed with a particular social identity or with specific preferences for the latter. While this vision makesthe economic agent more realistic, its representation by adding variables in an agent's utility function poses problems. The distinction between the agent's own preferences and those that society imposes on the agent becomes both blurred, and difficult to make. In order to separate these two facets of preferences, we explore the idea of an agent's personal identity of which his social identity is one aspect. To consider personal identity means endowing the economic agentwith the capacity to change, in particular, in the social space. This greatly complicates the problem of making welfare judgements since it is difficult to define a welfare improvement in the future. We next present a model in which the evolution of peoples' identities is stochastic. This can explain the appearance of individuals who seem to defy social convention. Our model shows how personal identity changes. We can find a social equilibrium only if personal identitymatters little. But this suggests, paradoxically, that for individuals to have well-established identities, society must be one which is is not in equilibrium, but one which will continue to change and in which both the social groups and the individuals are constantly being modified.

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Paper provided by HAL in its series Working Papers with number halshs-00410853.

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Date of creation: 2006
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Handle: RePEc:hal:wpaper:halshs-00410853
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  1. Horst, Ulrich & Scheinkman, Jose A., 2006. "Equilibria in systems of social interactions," Journal of Economic Theory, Elsevier, vol. 130(1), pages 44-77, September.
  2. George A. Akerlof & Rachel E. Kranton, 2000. "Economics And Identity," The Quarterly Journal of Economics, MIT Press, vol. 115(3), pages 715-753, August.
  3. Bernheim, B Douglas, 1994. "A Theory of Conformity," Journal of Political Economy, University of Chicago Press, vol. 102(5), pages 841-77, October.
  4. George A. Akerlof & Rachel E. Kranton, 2005. "Identity and the Economics of Organizations," Journal of Economic Perspectives, American Economic Association, vol. 19(1), pages 9-32, Winter.
  5. George A. Akerlof & Rachel E. Kranton, 2002. "Identity and Schooling: Some Lessons for the Economics of Education," Journal of Economic Literature, American Economic Association, vol. 40(4), pages 1167-1201, December.
  6. Alan Kirman & Miriam Teschl, 2006. "Searching for identity in the capability space," Journal of Economic Methodology, Taylor & Francis Journals, vol. 13(3), pages 299-325.
  7. Sen, Amartya K, 1973. "Behaviour and the Concept of Preference," Economica, London School of Economics and Political Science, vol. 40(159), pages 241-59, August.
  8. Gintis, Herbert, 1974. "Welfare Criteria with Endogenous Preferences: The Economics of Education," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 15(2), pages 415-30, June.
  9. George A. Akerlof, 1997. "Social Distance and Social Decisions," Econometrica, Econometric Society, vol. 65(5), pages 1005-1028, September.
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