The Importance of Norms: Behavioural Game Theory as a Tool to Understand Neighbourhood Events

Abstract

A neighbourhood’s viability depends strongly on the willingness of its residents to intervene. According to Mancur Olson’s free‐rider theorem, collective action will neither be initiated, nor sustained unless it is found profitable by every single participant. This “n‐person prisoners’ dilemma” indicates that the successful cases of cooperation, not the failures, call for an explanation; this is the theoretical starting point for a study of resident interactions in the viable Dutch mid‐rise post‐Second World War neighbourhood Buitenveldert‐Amsterdam. This article attempts to show that behavioural game theory is appropriate for the description and explanation of the reasoning and behaviour of residents who perceive collective good games. The deductive methodology known as analytic narrative is used to blend behavioural game theory and narration into the study of liveability problems. The results indicate that social norms are important as determinants of “what types of games residents play”, which in turn determines the degree of cooperative behaviour and the effectiveness of social control in a neighbourhood.

Key Words:

• Residential interactions
• Behavioral game theory
• Collective neighbourhood goods
• Trust
• Norm‐oriented
• Interactive behaviour

Acknowledgements

The author gratefully acknowledges the financial assistance of the Dutch government through the Habiforum Program Innovative Land Use. The author wants to thank Gwen van Eijk who helped interview residents of Buitenveldert‐Amsterdam and Professor Dr P. Boelhouwer, Professor B. Bengtsson, Dr L. Taal and an anonymous referee for valuable comments and suggestions.

Notes

1. The theory was developed extensively in the 1950s by many scholars and explicitly applied to biology in the 1970s. Mathematical game theory has been widely recognized as an important tool in many fields.

2. A core concept of game theory is the Nash equilibrium (Voss 2001:105).

3. Among the various aspects of self‐knowledge, self‐efficacy involves a generative capability in which cognitive, social, and behavioural subskills must be organized into integrated courses of action to serve innumerable purposes. Competent functioning requires both skills and self‐beliefs of efficacy to use them effectively (Bandura 1986).

4. Behavioural game theorists rely on data gathered in controlled laboratory and field environments to make assertions concerning human motivation (Gintis, Bowles, Boyd & Fehr 2005).

5. Social norms, he argues, are triggered when other people can observe what other people are doing. But I want to refine this argument. Only when I know that other people have observed what I am doing do I feel ashamed. For example: If I see that others help to clean the street and I don’t, I feel uncomfortable (guilt). This is a situation with a quasi‐moral norm that occurs in a situation with the characteristics of an Assurance Game. Quasi‐moral norms are subscribed to by the majority.

6. Elster states that (besides quasi‐moral norms) also social norms are conditional, in the sense that they are triggered by the presence or behaviour of other people. But defecting from social norms does not generate guilt.

7. A semi‐structured questionnaire was used for the in‐depth interviews, based upon insights derived from a pilot (Adriaanse 2004b).

8. In the following analysis the difference in total count of reported negative externalities is compared with the proportion of PDs reported in narratives concerning collective neighbourhood goods. Six respondents reported an average of 36% of PDs in their reports of interactions considering collective neighbourhood goods. The majority, 36 respondents, reported 11% PDs in their reports of interactions regarding collective neighbourhood goods.