The erosion of personal norms and cognitive dissonance

ABSTRACT

In this article, we study how personal norms and behaviour interact and evolve when agents try to reduce cognitive dissonance, and how this dynamic relates to Nash equilibrium. We find that in long run, agents play, and norms prescribe, Nash equilibrium in material payoffs (in the absence of norms). Our model captures two main facts: (i) norms erode along the play of the game; (ii) the erosion of norms depends on the set of possible economic choices, so that the policy maker can potentially influence them.

KEYWORDS:

• Cognitive dissonance
• Nash equilibrium
• dominant strategies
• norm dynamics

JEL CLASSIFICATION:

• A13
• C72

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

¹ For some reference on personal norms see Bicchieri and Chavez (2010), Bicchieri and Muldoon (2011).

² Our framework holds for any convex set S.

³ In a general setting we just need to assume that the set of possible norms coincides with the set of possible strategies.

⁴ Notice that if then, in the long run Thus, if in the long run we will observe an erosion of personal norms, while if a we will observe an amelioration of norms.

Additional information

Funding

The authors acknowledge financial support from the Spanish Ministry of Economia y Compet- itividad project under Grant [EC0-2011-29230]; the Spanish Ministry of Economia y Competitividad under Grant [ECO-2014-58297-R]; and the ERC (European Research Council) project TECTACOM under Grant ‘The Economics of Cultural Transmission and Applications to Communities, Organizations and Markets’.