Self Control in Peer Groups

Marco Battaglini (), Roland Benabou () and Jean Tirole

No 3149, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: People with a self-control problem often seek relief through social interactions rather than binding commitments. Thus, in self-help groups like Alcoholics Anonymous, Narcotics Anonymous etc, members are said to achieve better personal outcomes by mainly sharing their experiences. In other settings, however, peer influences can severely aggravate individual tendencies towards immediate gratification, as is often the case with interactions among schoolmates or neighborhood youths. Bringing together the issues of self-control and peer effects, we study how observing the behaviour of others affects individuals’ ability to resist their own impulses towards short-run gratification. We show how these purely informational spillovers can give rise to multiple equilibria, where agents’ choices of self-restraint or self-indulgence are mutually reinforcing. More generally, we identify conditions on agents’ initial self-confidence, confidence in others, and degree of correlation that uniquely lead to either a ‘good news’ equilibrium where social interactions improve self-discipline, a ‘bad news equilibrium’ where they damage it, or to both. We also conduct a welfare analysis to determine when group membership is preferable to, or worse than, isolation. Individuals will generally find groups useful for self-control only if they have at least a minimal level of confidence in their own and their peers’ ability to resist temptation. At the same time, having a partner who is ‘too perfect’ is no better than being alone, and therefore often less desirable than being matched to someone more like oneself. Our Paper thus provides a psychologically grounded theory of endogenous peer effects, as well as of the importance of group morale.

Keywords: addiction; clubs; memory; peer effects; psychology; self-control; social interactions; time-inconsistency; willpower (search for similar items in EconPapers)
JEL-codes: C72 D71 D82 D91 J24 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-gth, nep-lab, nep-mic and nep-ure
Date: Written
View list of references View citations in EconPapers

Downloads: (external link)
http://www.cepr.org/pubs/dps/DP3149.asp (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

Related works:
Working Paper: Self-Control in Peer Groups (2003)
Working Paper: Self-Control in peer Groups (2001)
Journal Article: Self-control in peer groups (2005)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:cpr:ceprdp:3149

Ordering information: This working paper can be ordered from
http://www.cepr.org/pubs/dps/DP3149.asp

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers
Address: Centre for Economic Policy Research, 53--56 Great Sutton Street, London EC1V 0DG
Series data maintained by ().