Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/96838
Year of Publication: 
2014
Series/Report no.: 
CESifo Working Paper No. 4741
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
Social preferences and social influence effects (“peer effects”) are well documented, but little is known about how peers shape social preferences. Settings where social preferences matter are often situations where peer effects are likely too. In a gift-exchange experiment with independent payoffs between two agents we find causal evidence for peer effects. Efforts are positively correlated but with a kink: agents follow a low-performing but not a high-performing peer. This contradicts major theories of social preferences which predict that efforts are unrelated, or negatively related. Some theories allow for positively-related efforts but cannot explain most observations. Conformism, norm following and social esteem are candidate explanations.
Subjects: 
social preferences
voluntary cooperation
peer effects
reflection problem
gift-exchange
conformism
social norms
social esteem
experiments
JEL: 
C92
D03
Document Type: 
Working Paper
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