Social Approval, Competition, and Cooperation

32 Pages Posted: 3 Oct 2011

See all articles by Xiaofei Pan

Xiaofei Pan

George Mason University - Department of Economics; George Mason University - Interdisciplinary Center for Economic Science (ICES)

Daniel Houser

George Mason University - Department of Economics; Interdisciplinary Center for Economic Science; George Mason University - Mercatus Center

Date Written: October 2, 2011

Abstract

Holländer (1990) argued that when non-monetary social approval from peers is sufficiently valuable, it works to promote cooperation. Holländer, however, did not define the characteristics of environments in which high valued approval is likely to occur. This paper provides evidence from a laboratory experiment indicating that people under competition value approval highly, but only when winners earn visible rewards through approval. The evidence implies that approval's value is tied to signaling motives. Our findings point to new institutions that rely on reward, rather than punishment, to efficiently promote generosity in groups.

Keywords: Social approval, cooperation, signaling and competition

JEL Classification: D02, D03, D64, H4

Suggested Citation

Pan, Xiaofei and Houser, Daniel, Social Approval, Competition, and Cooperation (October 2, 2011). GMU Working Paper in Economics No. 11-39, Available at SSRN: https://ssrn.com/abstract=1937305 or http://dx.doi.org/10.2139/ssrn.1937305

Xiaofei Pan (Contact Author)

George Mason University - Department of Economics ( email )

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George Mason University - Interdisciplinary Center for Economic Science (ICES) ( email )

400P Truland Building
George Mason University
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United States

Daniel Houser

George Mason University - Department of Economics ( email )

4400 University Drive
Fairfax, VA 22030
United States

Interdisciplinary Center for Economic Science ( email )

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George Mason University
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United States
7039934856 (Phone)

HOME PAGE: http://mason.gmu.edu/~dhouser/

George Mason University - Mercatus Center ( email )

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Arlington, VA 22201
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