Social norms in networks / Philip Ushchev (National Research University Higher School of Economics and Monash University), Yves Zenou (Monash University, CEPR and IZA) ; IZA Institute of Labor Economics
VerfasserUshchev, Philip ; Zenou, Yves
KörperschaftForschungsinstitut zur Zukunft der Arbeit
ErschienenBonn, Germany : IZA Institute of Labor Economics, November 2019
Elektronische Ressource
Umfang1 Online-Ressource (96 Seiten in verschiedenen Zählungen) : Diagramme
SerieDiscussion paper ; no. 12752
 Das Dokument ist öffentlich zugänglich im Rahmen des deutschen Urheberrechts.
Social norms in networks [0.75 mb]
Verfügbarkeit In meiner Bibliothek

Although the linear-in-means model is the workhorse model in empirical work on peer effects, its theoretical properties are understudied. In this study, we develop a social-norm model that provides a microfoundation of the linear-in-means model and investigate its properties. We show that individual outcomes may increase, decrease, or vary non- monotonically with the taste for conformity. Equilibria are usually inefficient and, to restore the first best, the planner needs to subsidize (tax) agents whose neighbors make efforts above (below) the social norms. Thus, giving more subsidies to more central agents is not necessarily efficient. We also discuss the policy implications of our model in terms of education and crime.