Who Makes a Good Leader? Social Preferences and Leading-by-Example

27 Pages Posted: 19 Jan 2009

See all articles by Simon Gaechter

Simon Gaechter

University of Nottingham; IZA Institute of Labor Economics; CESifo (Center for Economic Studies and Ifo Institute)

Daniele Nosenzo

University of Nottingham

Elke Renner

University of Nottingham

Martin Sefton

University of Nottingham - School of Economics

Abstract

We examine the effects of social preferences and beliefs about the social preferences of others in a simple leader-follower voluntary contributions game. We find that groups perform best when led by those who are reciprocally oriented. Part of the effect can be explained by a false consensus effect: selfish players tend to think it more likely that they are matched with another selfish player and reciprocators tend to think it more likely that they are matched with another reciprocator. Thus, reciprocators contribute more as leaders partly because they are more optimistic than selfish players about the reciprocal responses of followers. However, even after controlling for beliefs we find that reciprocally-oriented leaders contribute more than selfish leaders. Thus, we conclude that differing leader contributions by differing types of leader must in large part reflect social motivations.

Keywords: reciprocity, contribution preferences, leadership, leading-by-example, false consensus effect

JEL Classification: A13, C92, D03

Suggested Citation

Gachter, Simon and Nosenzo, Daniele and Renner, Elke and Sefton, Martin, Who Makes a Good Leader? Social Preferences and Leading-by-Example. IZA Discussion Paper No. 3914. Available at SSRN: https://ssrn.com/abstract=1329552

Simon Gachter (Contact Author)

University of Nottingham ( email )

University Park
Nottingham, NG8 1BB
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Daniele Nosenzo

University of Nottingham ( email )

University Park
Nottingham, NG8 1BB
United Kingdom

Elke Renner

University of Nottingham ( email )

University Park
Nottingham, NG8 1BB
United Kingdom

Martin Sefton

University of Nottingham - School of Economics ( email )

University Park
Nottingham, NG7 2RD
United Kingdom

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