Group formation, in-group bias and the cost of cheating

dc.contributor.author	MICHAELI, Moti
dc.date.accessioned	2015-03-26T13:33:12Z
dc.date.available	2015-03-26T13:33:12Z
dc.date.issued	2015
dc.identifier.issn	1830-7728
dc.identifier.uri	https://hdl.handle.net/1814/35218
dc.description.abstract	Group formation and in-group bias -- preferential treatment for insiders -- are widely observed social phenomena. This paper demonstrates how they arise naturally when people incur a psychological cost as the result of defecting when facing cooperators, when this cost is increasing and concave in the number of such defections. If some group members are asocial, i.e., insusceptible to that cost, then, under incomplete information, free-riding and cooperation can coexist within groups. Signaling of one's type can enable groups to screen out free-riders, but signaling is costly, and its availability may decrease the welfare of all the individuals in society.	en
dc.format.mimetype	application/pdf	en
dc.language.iso	en	en
dc.relation.ispartofseries	EUI MWP	en
dc.relation.ispartofseries	2015/04	en
dc.rights	info:eu-repo/semantics/openAccess	en
dc.subject	In-group bias	en
dc.subject	Group formation	en
dc.subject	Costly signaling	en
dc.subject	Prisoner's dilemma game	en
dc.subject	D7	en
dc.subject	D03	en
dc.subject	Z13	en
dc.subject	D64	en
dc.subject	D82	en
dc.subject	C72	en
dc.title	Group formation, in-group bias and the cost of cheating	en
dc.type	Working Paper	en