Premium
MUTUAL ADMIRATION CLUBS
Author(s) -
SUEN WING
Publication year - 2010
Publication title -
economic inquiry
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.823
H-Index - 72
eISSN - 1465-7295
pISSN - 0095-2583
DOI - 10.1111/j.1465-7295.2009.00254.x
Subject(s) - admiration , prior probability , group (periodic table) , social psychology , psychology , economics , microeconomics , positive economics , actuarial science , computer science , artificial intelligence , bayesian probability , chemistry , organic chemistry
This article proposes a theory of group formation based on the motive to seek informed opinion. Because an individual evaluates whether others are informed or not using his own priors, he identifies people with similar beliefs to be more informed than those with different beliefs. The result is an equilibrium in which like‐minded individuals self‐select into distinct groups, with members of each group believing that their own group is superior. ( JEL D71, D81, D83, D85)