Hate Trumps Love: The Impact of Political Polarization on Social Preferences

Abstract

Exhibiting altruism towards and cooperativeness with others is a key ingredient for successful work relationships and managerial decision-making. Rising political polarization creates a hazard because it ruptures this fabric and impedes the interaction of employees, especially across political isles. This paper's focus is to examine various behavioral-, belief-, and norm-based layers of (non-)strategic decision-making that are plausibly affected by polarization. I quantify this phenomenon via 5 pre-registered studies in the context of Donald J. Trump, comprising 15 well-powered behavioral experiments and a diverse set of over 8,600 participants. To capture the pervasiveness of polarization, I contrast the findings with various political and non-political identities. Overall, I consistently document strong heterogeneous effects: ingroup-love occurs in the perceptional domain (how close one feels towards others), whereas outgroup-hate occurs in the behavioral domain (how one helps/harms/cooperates with others). The rich setting also enables me to examine the mechanisms of observed intergroup conflict, which can be attributed to one's grim expectations regarding cooperativeness of the opposing faction, rather than one's actual unwillingness to cooperate. For the first time, the paper also tests whether popular behavioral interventions (defaults and norm-nudges) can reduce the detrimental impact of polarization in the contexts studied here. The tested interventions improve pro-sociality but are ineffective in closing the polarization gap.

Keywords: Identity, Norms, Nudging, Polarization, Social Preferences

JEL Classification: C9, D01, D9