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Web End = Theory Dec. (2016) 81:7388
DOI 10.1007/s11238-015-9527-7
Published online: 23 December 2015 Springer Science+Business Media New York 2015
Abstract Certain messages, even when not directly payoff relevant, can be a credible form of communication in light of natural social preferences. Social image concerns and other-regarding preferences interact to create incentives to communicate about how one feels about other people. Recognizing the prevalence of the incentive to communicate about ones social preferences suggests that many social and economic phenomenafrom norms of etiquette to cooperation to gift exchangeshould be seen, in part, as forms of signaling. These behaviors may be surprisingly robust to material costs, yet sensitive to context.
Keywords Cheap talk Credible communication Etiquette Signaling
Social preferences
1 Introduction
People are social creatures. We care about each other, and we care about how others feel about us. To understand economic behavior, such as public goods contributions, employee relations, consumption of socially responsible products, and more, we must account for the role of social preferences in the choices people make. Economists have long recognized other-regarding preferences, including altruism (Becker 1976; Andreoni 1989), spitefulness, and reciprocity (Levine 1998; Fehr and Gchter 2000b;
R. Golman thank Linda Babcock and Sudeep Bhatia for very helpful comments.
B Russell Golman
1 Department of Social and Decision Sciences, Carnegie Mellon University, 5000 Forbes Avenue,
Pittsburgh, PA 15213, USA
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Web End = Good manners: signaling social preferences
Russell Golman1
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Charness and Rabin 2002; Sobel 2005; Falk and Fischbacher 2006; Ackermann et al. 2014). They have also recognized social image concerns (Hollnder 1990; Bernheim 1994; Tadelis 2008; Andreoni and Bernheim 2009; Grossman 2015). It is tempting to try to attribute social behavior (such as giving freely to others) to one of these motives as opposed to the others, but this is a false choicethere is evidence that both kinds of social preferences are at play together (Bowles and Gintis 2005; DellaVigna et al. 2012).1
Certainly there is value in modeling either other-regarding preferences or social image concerns in isolation so that we may understand the specic implications...