Toward An Economic Theory of Dysfunctional Identity
Hanming Fang () and
No 1483, Cowles Foundation Discussion Papers from Cowles Foundation for Research in Economics, Yale University
We advance a novel choice-theoretic model of "identity" based on the notions of categories and narratives. Identity is conceived as a matter of "reflexive perception" -- how people understand themselves. Choosing an identity is equivalent to making a generalization about one's past that highlights the most salient aspects of experience. When many individuals make a common choice in this regard, they embrace a collective identity which is dysfunctional if it is Pareto dominated by an alternative self-classificatory schema. Using a simple multi-stage risk sharing game, we explore conditions under which dysfunctional collective identities might be expected to emerge.
Keywords: Identity; Dysfunctional Collective Identity (search for similar items in EconPapers)
JEL-codes: Z1 Z13 (search for similar items in EconPapers)
Pages: 48 pages
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Published in Christopher B. Barrett (ed.), The Social Economics of Poverty: On Identities, Groups, Communities and Networks, Routledge, 2005, pp. 12-55
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Working Paper: Toward an Economic Theory of Dysfunctional Identity (2004)
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