Social Identity and Social Free-Riding
IAAEU Working Paper
34 Pages Posted: 13 Dec 2015 Last revised: 18 Jan 2016
Date Written: October 31, 2015
We model individual identification choice as a strategic group formation problem. When choosing a social group to identify with, individuals appreciate high social status and a group stereotype to which they have a small social distance. A group's social status and stereotype are shaped by the (exogenous) individual attributes of its members and hence endogenous to individuals' choices. Unless disutility from social distance is strong enough, this creates a strategic tension as individuals with attributes that contribute little to group status would like to join high-status groups, thereby diluting the latters' status and changing stereotypes. Such social free-riding motivates the use of soft exclusion technologies in high-status groups, which provides a unifying rationale for phenomena such as hazing rituals, charitable activities or status symbols that is not taste-based or follows a standard signaling mechanism.
Keywords: social identity, social status, social distance, categorization, group formation
JEL Classification: D1, C7
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