Social norms, cooperation and inequality

This paper analyzes the outcomes that can be supported by social norms in a society of infinitely lived and patient agents that are randomly matched in pairs every period to play a given game. I find that any mutually beneficial outcome can be supported by a self-enforcing social norm under both per...

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Veröffentlicht in:Economic theory 2007-01, Vol.30 (1), p.89-105
1. Verfasser: Bó, Pedro Dal
Format: Artikel
Sprache:eng
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Zusammenfassung:This paper analyzes the outcomes that can be supported by social norms in a society of infinitely lived and patient agents that are randomly matched in pairs every period to play a given game. I find that any mutually beneficial outcome can be supported by a self-enforcing social norm under both perfect information and a simple local information system. These Folk Theorem results explain not only how social norms can provide incentives that support cooperation in a community, providing support to the concepts of social capital and corporate culture, but also how they can support inequality and discrimination.
ISSN:0938-2259
1432-0479
DOI:10.1007/s00199-005-0045-7