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Inequality, Belief Formation, Cooperation, Public Goods, Experiment
Abstract:
Salient heterogeneity is suspected to adversely affect cooperation. Within a public good game, I experimentally study i) the impact of inequality on the formation of beliefs about others’ cooperativeness, ii) the relationship of such beliefs with behaviour and iii) what impact emphasis on group membership has on the salience of inequality for belief formation, and on cooperation. Inequality drives belief formation: the rich are expected to cooperate more by both rich and poor subjects, and cooperative behaviour correlates positively with beliefs about the rich only. Finally, group membership salience affects neither the salience of inequality for belief formation nor aggregate cooperation, but it exerts a positive effect on poor subjects.
