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Conflict and segregation in networks: An experiment on the interplay between individual preferences and social influence

Lea Ellwardt (), Penelope Hernandez (), Guillem Martínez-Canovas () and Manuel Muñoz-Herrera
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Lea Ellwardt: University of Groningen
Guillem Martínez-Canovas: ERI-CES

No 114, Discussion Papers in Economic Behaviour from University of Valencia, ERI-CES

Abstract: We examine the interplay between a person's individual preference and the social influence others exert. We provide a model of network relationships with conflicting preferences, where individuals are better off coordinating with those around them, but not all prefer the same action. We test our model in an experiment, varying the level of conflicting preferences between individuals. Our findings suggest that preferences are more salient than social influence, under conflicting preferences: subjects relate mainly with others who prefer the same. This leads to two undesirable outcomes: network segregation and social inefficiency. The same force that helps people individually hurts society.

Keywords: Heterogeneity; Social Networks; Formation; Equilibrium selection (search for similar items in EconPapers)
JEL-codes: C62 C72 D82 D85 (search for similar items in EconPapers)
Date: 2014-01
New Economics Papers: this item is included in nep-cdm, nep-exp, nep-gth, nep-ltv, nep-net, nep-soc and nep-ure
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