An Experimental Investigation of Why Individuals Conform
Federal Reserve Bank of New York
December 5, 2008
FRB of New York Staff Report No. 365
Social interdependence is believed to play an important role in individual choice behavior. This paper outlines a simple model constructed on the premise that people are motivated by their own payoff and by how their action compares to others in their reference group. I show that conformity in actions may arise from learning about the norm, or from image-related concerns (social influence). In order to empirically disentangle the two, I use the fact that image-related concerns can only be present if actions are publicly observable. The model predictions are tested in a charitable contribution experiment in which the actions and identities of the subjects are unmasked in a controlled and systematic way. Both learning about the norm and social influence seem to play an important role in the choices of the subjects. Individuals indulge in social comparison and change their contributions in the direction of the social norm even when their identities are hidden. Once identities and contribution distributions of group members are revealed, individuals conform to the modal choice of the group. Moreover, I find that social ties (defined as subjects knowing each other from outside the lab) affect the role of social influence. In particular, a low contribution norm evolves that causes individuals to contribute less in the presence of friends.
Number of Pages in PDF File: 43
Keywords: conformity, social influence, social learning
JEL Classification: C9, D7, D8
Date posted: February 19, 2009
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