Essays on Social Preferences and Beliefs in Non-Embedded Social Dilemmas

Abstract

This thesis is about social dilemmas in non-embedded settings. Social dilemmas are situations where individual and collective interests are in conflict. Collective action problems, problems of trust, and cooperation are examples of social dilemmas. The standard rational choice model successfully explains behavior in embedded social dilemmas, i.e, social dilemmas that take place in repeated interactions, that are embedded in a social network or in an institutional context. However, the standard rational choice model fails to explain behavior in non-embedded social dilemmas. Non-embedded social dilemmas are social dilemmas that take place among strangers in social encounters. In four of the six empirical chapters, this thesis offers a revision of the standard rational choice model and explains behavior in non-embedded social dilemmas by three factors: (1) heterogeneous social preferences, (2) ego-centered---consensus type---biases in beliefs, and (3) evaluation error. These three factors correspond to two core assumptions of the standard rational choice model. The first factor revises the selfishness assumption and the other two ``stretch" the rationality assumption of the standard model. The final two empirical chapters include two applications of this theoretical framework. Chapter 6 experimentally studies the influence of procedural justice on cooperation. Chapter 7 reports an international inter-ethnic experiment with Turkish, Dutch, and Turkish-Dutch respondents, and shows clear inter-group differences in social preferences resembling the ``North vs. South" effect, but no ingroup favoritism is found