Open AccessPEER EFFECTS IN PRO‐SOCIAL BEHAVIOR: SOCIAL NORMS OR SOCIAL PREFERENCES?
Author(s) -
Gächter Simon,
Nosenzo Daniele,
Sefton Martin
Publication year - 2013
Publication title -
journal of the european economic association
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 7.792
H-Index - 93
eISSN - 1542-4774
pISSN - 1542-4766
DOI - 10.1111/jeea.12015
Subject(s) - social preferences , economics , inequity aversion , explanatory power , microeconomics , peer effects , social influence , preference , norm (philosophy) , context (archaeology) , social psychology , stochastic game , ultimatum game , psychology , inequality , political science , mathematical analysis , mathematics , law , philosophy , paleontology , epistemology , biology
We compare social preference and social norm–based explanations for peer effects in a three‐person gift exchange experiment. In the experiment a principal pays a wage to each of two agents, who then make effort choices sequentially. In our baseline treatment we observe that the second agent's effort is influenced by the effort choice of the first agent, even though there are no material spillovers between agents. This peer effect is predicted by the Fehr–Schmidt (1999) model of social preferences. As we show from a norms elicitation experiment, it is also consistent with social norms compliance. A conditional logit investigation of the explanatory power of payoff inequality and elicited norms finds that the second agent's effort is best explained by the social preferences model. In further experiments we find that the peer effects change as predicted by the social preferences model. Again, a conditional logit analysis favors an explanation based on social preferences, rather than social norms. Our results suggest that, in our context, the social preferences model provides a parsimonious explanation for the observed peer effect.