The Value of Groups

We present the results of an experiment that attempts to measure the social value of groups. In the experiment, group membership is induced artificially: subjects interact with insiders and outsiders in trust games and periodically enter markets where they can trade group membership. We find that tr...

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Bibliographic Details
Published in:The American economic review 2009-03, Vol.99 (1), p.295-323
Main Authors: Heap, Shaun P. Hargreaves, Zizzo, Daniel John
Format: Article
Language:English
Subjects:
Economic psychology
Economic value
Economics
Experimental psychology
Experiments
Games
Gender discrimination
Group dynamics
Group membership
Groups
Happiness
Kinship
Market prices
Measurement
Memberships
Observational research
Psychological regression
Psychometrics
Social capital
Social conditions & trends
Social psychology
Social values
Studies
Trust
Values
We they distinction
Welfare
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Summary:We present the results of an experiment that attempts to measure the social value of groups. In the experiment, group membership is induced artificially: subjects interact with insiders and outsiders in trust games and periodically enter markets where they can trade group membership. We find that trust falls with groups because of negative discrimination against outsiders. Against this, however, there is evidence that group membership provides a psychological benefit, albeit one that may induce social inertia. Overall, the welfare effects of groups are at best neutral and could be negative.
ISSN:0002-8282
1944-7981
DOI:10.1257/aer.99.1.295