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Categorical Cognition: A Psychological Model of Categories and Identification in Decision Making

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  • Roland G. Fryer, Jr.
  • Matthew O. Jackson

Abstract

There is a wealth of research in psychology demonstrating that agents process information with the aid of categories. In this paper we study this phenomenon in two parts. First, we build a model of how experiences are sorted into categories and how categorization affects decision making. Second, we analyze the personal biases that result from categorization, in economic contexts. We show that discrimination 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 concept of identity, where identity is viewed as self-categorization.

Suggested Citation

  • 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.
    • Handle: RePEc:nbr:nberwo:9579
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination

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