Journal Article

History, Expectations, and Leadership in the Evolution of Social Norms

Daron Acemoglu and Matthew O. Jackson

in The Review of Economic Studies

Volume 82, issue 2, pages 423-456
Published in print April 2015 | ISSN: 0034-6527
Published online December 2014 | e-ISSN: 1467-937X | DOI: https://dx.doi.org/10.1093/restud/rdu039
History, Expectations, and Leadership in the Evolution of Social Norms

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  • Game Theory and Bargaining Theory
  • Capitalist Systems
  • Economic Sociology
  • Analysis of Collective Decision-making

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We study the evolution of a social norm of “cooperation” in a dynamic environment. Each agent lives for two periods and interacts with agents from the previous and next generations via a coordination game. Social norms emerge as patterns of behaviour that are stable in part due to agents' interpretations of private information about the past, influenced by occasional commonly observed past behaviours. For sufficiently backward-looking societies, history completely drives equilibrium play, leading to a social norm of high or low cooperation. In more forward-looking societies, there is a pattern of “reversion” whereby play starting with high (low) cooperation reverts towards lower (higher) cooperation. The impact of history can be countered by occasional “prominent” agents, whose actions are visible by all future agents and who can leverage their greater visibility to influence expectations of future agents and overturn social norms of low cooperation.

Keywords: Cooperation; Coordination; Expectations; History; Leadership; Overlapping Generations; Repeated Games; Social Norms; C72; C73; D7; P16; Z1

Journal Article.  19052 words.  Illustrated.

Subjects: Game Theory and Bargaining Theory ; Capitalist Systems ; Economic Sociology ; Analysis of Collective Decision-making

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