Strategic behaviour with tight, loose and polarised norms by Silvia Sonderegger

Join us for another event in the Microeconomics Research Seminar Series, Autumn Term 2022.

Silvia Sonderegger from the School of Economics, University of Nottingham will present their research on Strategic behaviour with tight, loose and polarised norms.

Abstract

Descriptive norms -- the behavior of other individuals in one's reference group -- play a key role in shaping individual decisions.  When characterizing the behavior of others, a standard approach in the literature is to focus on  average behavior. In this paper, we argue both theoretically and empirically that not only averages, but the shape of the whole distribution of behavior can play a crucial role in how people react to descriptive norms. Using a representative sample of the U.S. population, we experimentally investigate how individuals react to strategic environments that are characterized by different distributions of behavior, focusing on the distinction between tight (i.e., characterized by low behavioral variance), loose (i.e., characterized by high behavioral variance), and polarized (i.e., characterized by u-shaped behavior) environments. We find that individuals indeed strongly respond to differences in the variance and shape of the descriptive norm they are facing: loose norms generate greater behavioral variance and polarization generates polarized responses. In polarized environments, most individuals prefer extreme actions that expose them to considerable strategic risk to intermediate actions that would minimize such risk. Importantly, we also find that, in polarized and loose environments, personal traits and values play a larger role in determining actual behavior. This provides important insights into how individuals navigate environments that contain strategic uncertainty.

This seminar will be held in the Economics Common Room on Monday 21 November 2022 at 4pm. This event is open to all levels of study and is also open to the public.

To register your place and gain access to the webinar, please contact the seminar organisers.

This event is part of the Microeconomics Research Seminar Series.