This paper studies a coordination game between a continuum of players with heterogeneous tastes who perceive peer pressure when behaving differently from each other. It characterizes the conditions under which a social norm-a mode of behavior followed by many- exists in equilibrium and the patterns of norm compliance. The emergent norm may be biased compared to the average taste in society, yet endogenously upheld by the population. Strikingly, a biased norm will, under some circumstances, be more sustainable than a non-biased norm, which may explain the bias of various social and religious norms.
ASJC Scopus subject areas
- Economics, Econometrics and Finance (all)