Abstract
Standard economic theories assume that people are self-interested and their wellbeing solely dependent on their own material gains or losses. Unless they have an impact on monetary payoffs, the perceptions of anonymous individuals are irrelevant to people’s decision making. However, a large body of research in sociology and social psychology demonstrates that self-identity is developed through one’s understanding of how one is perceived by others. Using (Cooley’s, Human nature and the social order, 1964) concept of the “looking-glass self” as a framework, we evaluate experimentally whether or not people care about the imputed judgment of anonymous others arising from their imagination of their perceptions. We implemented variants of the Becker–DeGroot–Marschak mechanism to elicit the monetary value attached to the perceptions by participants. In one variant, only nonnegative bids were allowed, while in another, negative bids were allowed. We show that in an environment in which the perceptions of others are only conveyed to participants anonymously and privately, self-interested individuals exhibited strong negative perception avoidance even though the perceptions have no impact on their monetary payoff. The participants were willing to spend a significant amount in order to avoid confirming the supposedly negative perception. Thus, for them, ignorance was truly bliss. We also show that, in the absence of the audience effect, the fair-minded participants adopted a neutral attitude towards the perception of them as fair.
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Notes
We thank one of our anonymous referees for his/her excellent suggestion to conduct this additional treatment.
Note that if the successful bid was below S$0 in the MPTR treatment, this essentially implies the dictator would receive a payment from the experimenter in order to reveal the message.
A better way of analyzing the messages would be to follow the procedure developed by Houser and Xiao (2010).
The answers given to the survey questions were not incentivized. In addition, participation in the survey was not compulsory, so the return rate was around 70 %. The results should therefore be interpreted with some caution.
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Acknowledgments
Financial support from the Nanyang Technological University and the Singapore Institute of Management is gratefully acknowledged. We thank Francis Chin, Stephen Knowles, Maroš Servátka, David de Meza, Jörn Rothe, Tatsuyoshi Saijo, Jason Shachat, and Songfa Zhong, as well as participants at the 2013 World Meetings of the Economic Science Association (ESA) at the University of Zurich (Switzerland), the 2013 Asia Meeting of the Econometric Society at the National University of Singapore (Singapore), and the 2014 Asia–Pacific Meeting of the Economic Science Association (ESA) at the University of Auckland (New Zealand).
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Riyanto, Y.E., Zhang, J. Putting a price tag on others’ perceptions of us. Exp Econ 19, 480–499 (2016). https://doi.org/10.1007/s10683-015-9450-3
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DOI: https://doi.org/10.1007/s10683-015-9450-3