American Institute of Mathematical Sciences

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April  2016, 3(2): 191-216. doi: 10.3934/jdg.2016010

Conflict and segregation in networks: An experiment on the interplay between individual preferences and social influence

Lea Ellwardt 1, , Penélope Hernández 2, , Guillem Martínez-Cánovas 2, and  Manuel Muñoz-Herrera 2,

1. 

Institute of Sociology and Social Psychology, University of Cologne, Cologne, Germany
2. 

ERI-CES, Departamento de Análisis Económico, Universitat de Valencia, Avenida Los Naranjos s/n, Campus de Tarongers, Valencia, 46022, Spain, Spain, Spain

Received  February 2016 Revised  April 2016 Published  April 2016

We examine the interplay between a person's individual preference and the social influence others exert. We provide a model of network relationships with conflicting preferences, where individuals are better off coordinating with those around them, but where not all have a preference for the same action. We test our model in an experiment, varying the level of conflicting preferences between individuals. Our findings suggest that preferences are more salient than social influence, under conflicting preferences: subjects relate mainly with others who have the same preferences. This leads to two undesirable outcomes: network segregation and social inefficiency. The same force that helps people individually, hurts society.
Keywords: equilibrium selection., Heterogeneity, formation, social networks.
Mathematics Subject Classification: Primary: 91A90; Secondary: 91A4.
Citation: Lea Ellwardt, Penélope Hernández, Guillem Martínez-Cánovas, Manuel Muñoz-Herrera. Conflict and segregation in networks: An experiment on the interplay between individual preferences and social influence. Journal of Dynamics and Games, 2016, 3 (2) : 191-216. doi: 10.3934/jdg.2016010
References:
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G. A. Akerlof and R. E. Kranton, Economics and identity, The Quarterly Journal of Economics, 115 (2000), 715-753. doi: 10.1515/9781400834181.

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G. A. Akerlof and R. E. Kranton, Identity and the economics of organizations, The Journal of Economic Perspectives, 19 (2005), 9-32. doi: 10.1257/0895330053147930.

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G. A. Akerlof and R. E. Kranton, Identity Economics: How Our Identities Shape Our Work, Wages, and Well-Being, Princeton University Press, 2010.

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V. Bala and S. Goyal, A noncooperative model of network formation, Econometrica, 68 (2000), 1181-1229. doi: 10.1111/1468-0262.00155.

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C. Ballester, A. Calvó-Armengol and Y. Zenou, Who's who in networks. wanted: The key player, Econometrica, 74 (2006), 1403-1417. doi: 10.1111/j.1468-0262.2006.00709.x.

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H. Bernhard, E. Fehr and U. Fischbacher, Group affiliation and altruistic norm enforcement, The American Economic Review, 96 (2006), 217-221. doi: 10.1257/000282806777212594.

[8]

M. Billig and H. Tajfel, Social categorization and similarity in intergroup behaviour, European Journal of Social Psychology, 3 (1973), 27-52. doi: 10.1002/ejsp.2420030103.

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M. B. Brewer, In-group bias in the minimal intergroup situation: A cognitive-motivational analysis, Psychological bulletin, 86 (1979), 307-324. doi: 10.1037/0033-2909.86.2.307.

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A. Calvó-Armengol and R. İlkılıç, Pairwise-stability and nash equilibria in network formation, International Journal of Game Theory, 38 (2009), 51-79. doi: 10.1007/s00182-008-0140-7.

[11]

C. Camerer, Behavioral Game Theory: Experiments in Strategic Interaction, Princeton University Press, 2003.

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G. Charness, L. Rigotti and A. Rustichini, Individual behavior and group membership,, The American Economic Review, (): 1340.  doi: 10.2139/ssrn.894685.

[13]

Y. Chen and S. X. Li, Group identity and social preferences, The American Economic Review, 99 (2009), 431-457. doi: 10.1257/aer.99.1.431.

[14]

G. Ellison, Learning, local interaction, and coordination, Econometrica, 61 (1993), 1047-1071. doi: 10.2307/2951493.

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J. Farrell and M. Rabin, Cheap talk, Journal of Economic Perspectives, 10 (1996), 103-118. doi: 10.1257/jep.10.3.103.

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U. Fischbacher, z-tree: Zurich toolbox for ready-made economic experiments, Experimental economics, 10 (2007), 171-178. doi: 10.1007/s10683-006-9159-4.

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A. Galeotti, S. Goyal, M. Jackson, F. Vega-Redondo and L. Yariv, Network games, Review of Economic Studies, 77 (2010), 218-244. doi: 10.1111/j.1467-937X.2009.00570.x.

[18]

L. Goette, D. Huffman and S. Meier, The impact of group membership on cooperation and norm enforcement: Evidence using random assignment to real social groups, The American economic review, 96 (2006), 212-216. doi: 10.1257/000282806777211658.

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S. Goyal, Connections: An Introduction to the Economics of Networks, Princeton University Press, 2007.

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M. Granovetter, Threshold models of collective behavior, American journal of sociology, 83 (1978), 1420-1443. doi: 10.1086/226707.

[21]

P. Hernández, M. Muñoz-Herrera and Á. Sánchez, Heterogeneous network games, Games and Economic Behavior, 79 (2013), p56. doi: 10.1016/j.geb.2013.01.004.

[22]

M. O. Jackson, A survey of network formation models: Stability and efficiency, Group Formation in Economics: Networks, Clubs, and Coalitions, (2010), 11-57. doi: 10.1017/CBO9780511614385.002.

[23]

M. O. Jackson, Networks and economic behavior, Annu. Rev. Econ., 1 (2009), 489-511. doi: 10.1146/annurev.economics.050708.143238.

[24]

M. O. Jackson, Social and Economic Networks, Princeton University Press, 2008.

[25]

M. O. Jackson and A. Watts, The existence of pairwise stable networks,, Seoul Journal of Economics., (). 

[26]

M. O. Jackson and A. Watts, On the formation of interaction networks in social coordination games, Games and Economic Behavior, 41 (2002), 265-291. doi: 10.1016/S0899-8256(02)00504-3.

[27]

M. O. Jackson and A. Wolinsky, A strategic model of social and economic networks, Journal of economic theory, 71 (1996), 44-74. doi: 10.1006/jeth.1996.0108.

[28]

M. Kandori, G. J. Mailath and R. Rob, Learning, mutation, and long run equilibria in games, Econometrica: Journal of the Econometric Society, 61 (1993), 29-56. doi: 10.2307/2951777.

[29]

G. J. Leonardelli and M. B. Brewer, Minority and majority discrimination: When and why, Journal of Experimental Social Psychology, 37 (2001), 468-485. doi: 10.1006/jesp.2001.1475.

[30]

D. López-Pintado, Contagion and coordination in random networks, International Journal of Game Theory, 34 (2006), 371-381. doi: 10.1007/s00182-006-0026-5.

[31]

P. V. Marsden, Network diversity, substructures, and opportunities for contact,, Structures of power and constraint: Papers in honor of Peter Blau, (): 397. 

[32]

M. McPherson, L. Smith-Lovin and J. M. Cook, Birds of a feather: Homophily in social networks, Annual review of sociology, 27 (2001), 415-444. doi: 10.1146/annurev.soc.27.1.415.

[33]

S. Morris, Contagion, The Review of Economic Studies, 67 (2000), 57-78. doi: 10.1111/1467-937X.00121.

[34]

B. Mullen, R. Brown and C. Smith, Ingroup bias as a function of salience, relevance, and status: An integration, European Journal of Social Psychology, 22 (1992), 103-122. doi: 10.1002/ejsp.2420220202.

[35]

M. Muñoz-Herrera, J. Dijkstra, A. Flache and R. Wittek, How specialization can breed social exclusion: A model of strategic interaction between pecialists and generalists in knowledge-intensive productive exchange,, Working Paper, (). 

[36]

T. Schelling, Micromotives and Macrobehavior, New York: WW Norton, 1978.

[37]

T. Snijders and R. J. Bosker, Multilevel Analysis: An Introduction to Basic and Applied Multilevel Analysis, 2nd edition, London: Sage, 2012.

[38]

H. Tajfel and J. C. Turner, An integrative theory of intergroup conflict, The social psychology of intergroup relations, 33 (1979), p47.

[39]

J. C. Turner, Social categorization and social discrimination in the minimal group paradigm,, Differentiation between social groups: Studies in the social psychology of intergroup relations, (): 101. 

[40]

J. C. Turner, M. A. Hogg, P. J. Oakes, S. D. Reicher and M. S. Wetherell, Rediscovering the Social Group: A Self-Categorization Theory., Basil Blackwell, 1987.

[41]

F. Vega-Redondo, Complex Social Networks, vol. 44, Cambridge Univ Pr, 2007. doi: 10.1017/CBO9780511804052.

[42]

L. M. Verbrugge, The structure of adult friendship choices, Social Forces, 56 (1977), 576-597.

[43]

X. Vives, Games with strategic complementarities: New applications to industrial organization, International Journal of Industrial Organization, 23 (2005), 625-637. doi: 10.1016/j.ijindorg.2005.04.002.

[44]

H. P. Young, The evolution of conventions, Econometrica: Journal of the Econometric Society, 61 (1993), 57-84. doi: 10.2307/2951778.

show all references

References:
[1]

G. A. Akerlof and R. E. Kranton, Economics and identity, The Quarterly Journal of Economics, 115 (2000), 715-753. doi: 10.1515/9781400834181.

[2]

G. A. Akerlof and R. E. Kranton, Identity and schooling: Some lessons for the economics of education, Journal of economic literature, 40 (2002), 1167-1201. doi: 10.1257/.40.4.1167.

[3]

G. A. Akerlof and R. E. Kranton, Identity and the economics of organizations, The Journal of Economic Perspectives, 19 (2005), 9-32. doi: 10.1257/0895330053147930.

[4]

G. A. Akerlof and R. E. Kranton, Identity Economics: How Our Identities Shape Our Work, Wages, and Well-Being, Princeton University Press, 2010.

[5]

V. Bala and S. Goyal, A noncooperative model of network formation, Econometrica, 68 (2000), 1181-1229. doi: 10.1111/1468-0262.00155.

[6]

C. Ballester, A. Calvó-Armengol and Y. Zenou, Who's who in networks. wanted: The key player, Econometrica, 74 (2006), 1403-1417. doi: 10.1111/j.1468-0262.2006.00709.x.

[7]

H. Bernhard, E. Fehr and U. Fischbacher, Group affiliation and altruistic norm enforcement, The American Economic Review, 96 (2006), 217-221. doi: 10.1257/000282806777212594.

[8]

M. Billig and H. Tajfel, Social categorization and similarity in intergroup behaviour, European Journal of Social Psychology, 3 (1973), 27-52. doi: 10.1002/ejsp.2420030103.

[9]

M. B. Brewer, In-group bias in the minimal intergroup situation: A cognitive-motivational analysis, Psychological bulletin, 86 (1979), 307-324. doi: 10.1037/0033-2909.86.2.307.

[10]

A. Calvó-Armengol and R. İlkılıç, Pairwise-stability and nash equilibria in network formation, International Journal of Game Theory, 38 (2009), 51-79. doi: 10.1007/s00182-008-0140-7.

[11]

C. Camerer, Behavioral Game Theory: Experiments in Strategic Interaction, Princeton University Press, 2003.

[12]

G. Charness, L. Rigotti and A. Rustichini, Individual behavior and group membership,, The American Economic Review, (): 1340.  doi: 10.2139/ssrn.894685.

[13]

Y. Chen and S. X. Li, Group identity and social preferences, The American Economic Review, 99 (2009), 431-457. doi: 10.1257/aer.99.1.431.

[14]

G. Ellison, Learning, local interaction, and coordination, Econometrica, 61 (1993), 1047-1071. doi: 10.2307/2951493.

[15]

J. Farrell and M. Rabin, Cheap talk, Journal of Economic Perspectives, 10 (1996), 103-118. doi: 10.1257/jep.10.3.103.

[16]

U. Fischbacher, z-tree: Zurich toolbox for ready-made economic experiments, Experimental economics, 10 (2007), 171-178. doi: 10.1007/s10683-006-9159-4.

[17]

A. Galeotti, S. Goyal, M. Jackson, F. Vega-Redondo and L. Yariv, Network games, Review of Economic Studies, 77 (2010), 218-244. doi: 10.1111/j.1467-937X.2009.00570.x.

[18]

L. Goette, D. Huffman and S. Meier, The impact of group membership on cooperation and norm enforcement: Evidence using random assignment to real social groups, The American economic review, 96 (2006), 212-216. doi: 10.1257/000282806777211658.

[19]

S. Goyal, Connections: An Introduction to the Economics of Networks, Princeton University Press, 2007.

[20]

M. Granovetter, Threshold models of collective behavior, American journal of sociology, 83 (1978), 1420-1443. doi: 10.1086/226707.

[21]

P. Hernández, M. Muñoz-Herrera and Á. Sánchez, Heterogeneous network games, Games and Economic Behavior, 79 (2013), p56. doi: 10.1016/j.geb.2013.01.004.

[22]

M. O. Jackson, A survey of network formation models: Stability and efficiency, Group Formation in Economics: Networks, Clubs, and Coalitions, (2010), 11-57. doi: 10.1017/CBO9780511614385.002.

[23]

M. O. Jackson, Networks and economic behavior, Annu. Rev. Econ., 1 (2009), 489-511. doi: 10.1146/annurev.economics.050708.143238.

[24]

M. O. Jackson, Social and Economic Networks, Princeton University Press, 2008.

[25]

M. O. Jackson and A. Watts, The existence of pairwise stable networks,, Seoul Journal of Economics., (). 

[26]

M. O. Jackson and A. Watts, On the formation of interaction networks in social coordination games, Games and Economic Behavior, 41 (2002), 265-291. doi: 10.1016/S0899-8256(02)00504-3.

[27]

M. O. Jackson and A. Wolinsky, A strategic model of social and economic networks, Journal of economic theory, 71 (1996), 44-74. doi: 10.1006/jeth.1996.0108.

[28]

M. Kandori, G. J. Mailath and R. Rob, Learning, mutation, and long run equilibria in games, Econometrica: Journal of the Econometric Society, 61 (1993), 29-56. doi: 10.2307/2951777.

[29]

G. J. Leonardelli and M. B. Brewer, Minority and majority discrimination: When and why, Journal of Experimental Social Psychology, 37 (2001), 468-485. doi: 10.1006/jesp.2001.1475.

[30]

D. López-Pintado, Contagion and coordination in random networks, International Journal of Game Theory, 34 (2006), 371-381. doi: 10.1007/s00182-006-0026-5.

[31]

P. V. Marsden, Network diversity, substructures, and opportunities for contact,, Structures of power and constraint: Papers in honor of Peter Blau, (): 397. 

[32]

M. McPherson, L. Smith-Lovin and J. M. Cook, Birds of a feather: Homophily in social networks, Annual review of sociology, 27 (2001), 415-444. doi: 10.1146/annurev.soc.27.1.415.

[33]

S. Morris, Contagion, The Review of Economic Studies, 67 (2000), 57-78. doi: 10.1111/1467-937X.00121.

[34]

B. Mullen, R. Brown and C. Smith, Ingroup bias as a function of salience, relevance, and status: An integration, European Journal of Social Psychology, 22 (1992), 103-122. doi: 10.1002/ejsp.2420220202.

[35]

M. Muñoz-Herrera, J. Dijkstra, A. Flache and R. Wittek, How specialization can breed social exclusion: A model of strategic interaction between pecialists and generalists in knowledge-intensive productive exchange,, Working Paper, (). 

[36]

T. Schelling, Micromotives and Macrobehavior, New York: WW Norton, 1978.

[37]

T. Snijders and R. J. Bosker, Multilevel Analysis: An Introduction to Basic and Applied Multilevel Analysis, 2nd edition, London: Sage, 2012.

[38]

H. Tajfel and J. C. Turner, An integrative theory of intergroup conflict, The social psychology of intergroup relations, 33 (1979), p47.

[39]

J. C. Turner, Social categorization and social discrimination in the minimal group paradigm,, Differentiation between social groups: Studies in the social psychology of intergroup relations, (): 101. 

[40]

J. C. Turner, M. A. Hogg, P. J. Oakes, S. D. Reicher and M. S. Wetherell, Rediscovering the Social Group: A Self-Categorization Theory., Basil Blackwell, 1987.

[41]

F. Vega-Redondo, Complex Social Networks, vol. 44, Cambridge Univ Pr, 2007. doi: 10.1017/CBO9780511804052.

[42]

L. M. Verbrugge, The structure of adult friendship choices, Social Forces, 56 (1977), 576-597.

[43]

X. Vives, Games with strategic complementarities: New applications to industrial organization, International Journal of Industrial Organization, 23 (2005), 625-637. doi: 10.1016/j.ijindorg.2005.04.002.

[44]

H. P. Young, The evolution of conventions, Econometrica: Journal of the Econometric Society, 61 (1993), 57-84. doi: 10.2307/2951778.

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