To Segregate, or to Discriminate – That Is the Question: Experiment on Identity and Social Preferences
52 Pages Posted: 27 Aug 2020
Date Written: August 24, 2020
How do various sources of social identity affect segregation and discrimination decisions? In our laboratory experiment, social identity originates either from similar preferences, income, ability, randomly or from shared socioeconomic status. For the latter, we exploit Colombia's unique (public information) stratification system which assigns households to socioeconomic strata based on its residential block amenities. Subjects decide with whom to interact in a Dictator and Trust Game. We find high socioeconomic status senders segregate against out-group receivers in the Dictator Game, while low socioeconomic ones do so in the Trust Game.
This segregation pattern is partly explained by payoff-maximizing behavior. In the Trust Game, we gather evidence for statistical discrimination. In the Dictator Game, evidence points to a taste for redistribution when identity originates from socioeconomic status or income level. No matter the source of identity, our subjects expect being segregated but not discriminated against.
Keywords: Socioeconomic status, stratification, segregation, discrimination, laboratory experiment
JEL Classification: C91, D91, J15, Z13
Suggested Citation: Suggested Citation