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Preferences for Consistency

39 Pages Posted: 17 Jul 2011  

Armin Falk

IZA Institute of Labor Economics; University of Bonn - Economic Science Area; CESifo (Center for Economic Studies and Ifo Institute)

Florian Zimmermann

University of Bonn

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Abstract

This paper studies how a preference for consistency can affect economic decision-making. We propose a two-period model where people have a preference for consistency because consistent behavior allows them to signal personal and intellectual strength. We then present three experiments that study main predictions and implications of the model. The first is a simple principal-agent experiment that shows that consistency is valued by others and that this value is anticipated. The second experiment underlines the crucial role of early commitment for consistency preferences. Finally we show how preferences for consistency can be used to manipulate choices.

Keywords: consistency preferences, experiments, early commitment, charitable giving, social influence

JEL Classification: C91, D03, D64

Suggested Citation

Falk, Armin and Zimmermann, Florian, Preferences for Consistency. IZA Discussion Paper No. 5840. Available at SSRN: https://ssrn.com/abstract=1887526

Armin Falk (Contact Author)

IZA Institute of Labor Economics ( email )

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

University of Bonn - Economic Science Area

Adenauerallee 24-42
D-53113 Bonn
Germany

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Florian Zimmermann

University of Bonn ( email )

Regina-Pacis-Weg 3
Postfach 2220
Bonn, D-53012
Germany

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