Peer pressure

Antoni Calvó-Armengol, Matthew O. Jackson

    Research output: Contribution to journalArticleResearchpeer-review

    22 Citations (Scopus)

    Abstract

    We present a model where agents care about their neighbors' actions and can pressure them to take certain actions. Exerting pressure is costly for the exerting agent and it can impact the pressured agents by either lowering the cost of taking the action (which we call "positive pressure")or else by raising the cost of not taking the action (which we call "negative pressure"). We show that when actions are strategic complements, agents with lower costs for taking an action pressure agents with higher costs, and that positive pressure can improve societal welfare. More generally, we detail who gains and who loses from peer pressure, and identify some circumstances under which pressure results in fully (Pareto) optimal outcomes as well as circumstances where it does not. We also point out differences between positive and negative pressure. © 2010 by the European Economic Association.
    Original languageEnglish
    Pages (from-to)62-89
    JournalJournal of the European Economic Association
    Volume8
    Issue number1
    DOIs
    Publication statusPublished - 1 Mar 2010

    Fingerprint

    Dive into the research topics of 'Peer pressure'. Together they form a unique fingerprint.

    Cite this