Cultural values and behavior in dictator, ultimatum and trust games: an experimental study

Culture is a central concept broadly studied in social anthropology and sociology. It has been gaining increasing attention in economics in relation to research on discrimination in a labor market, identity, gender, and social preferences. Most experimental economics research on culture studies cross-national or cross-ethnic differences in economic behavior. These studies reveal clear behavioral differences across different ethnic groups, yet do not provide a general deductive framework for specifying the underlying preferences behind these differences. We explain laboratory behavior in the dictator, ultimatum, and trust games based on two cultural dimensions adopted from a prominent general cultural framework in contemporary social anthropology: group commitment and grid control. Group-ness measures the extent to which individual identity is incorporated into group or collective identity; grid-ness measures the extent to which social and political prescriptions intrinsically influence individual behavior. One objective of this paper is to show that the grid-group framework, despite its origins in comparative ethnography, is adaptable to an experimental setting and indeed provides a parsimonious framework for generating testable behavioral predictions across a variety of experimental games. Another is to test the predictions of the grid-group framework on a number of simple games widely employed by experimental economists. Grid-group characteristics are measured for each individual using selected items from the World Values Survey. We find that these attributes allow us to systematically predict behavior in a way that discriminates among multiple forms of social preferences using a simple, parsimonious deductive model. Based on the implications of the theory, we hypothesize that subjects with higher group scores will tend to offer more in dictator and ultimatum games and entrust more in trust games. When responding in ultimatum games, those with high grid scores are hypothesized to reject more often and divide less, and to tie acceptance and amount divided more closely to the amount offered. When responding in trust games, those with low group scores are hypothesized to return less, and those with high grid scores to tie the amount returned more closely to the amount entrusted. These theoretical predictions are confirmed overall for most experimental games, although the strength of empirical support varies across games. We conclude that grid-group cultural theory is a viable predictor of people’s economic behavior, and further discuss potential limitations of the current approach and the ways to improve it.