ECONOMICS AND IDENTITY*
GEORGE A. AKERLOF AND RACHEL E. KRANTON
This paper considers how identity, a person’s sense of self, affects economicoutcomes. We incorporate the psychology and sociology of identity into an economicmodel of behavior. In the utility function we propose, identity is associated withdifferent social categories and how people in these categories should behave. Wethen construct a simple game-theoretic model showing how identity can affectindividual interactions. The paper adapts these models to gender discrimination inthe workplace, the economics of poverty and social exclusion, and the householddivision of labor. In each case, the inclusion of identity substantively changesconclusions of previous economic analysis.
I. INTRODUCTION
This paper introduces identity—a person’s sense of self—intoeconomic analysis. Identity can account for many phenomena thatcurrent economics cannot well explain. It can comfortably resolve,for example, why some women oppose ‘‘women’s rights,’’ as seen inmicrocosm when Betty Friedan was ostracized by fellow suburban
* The authors especially wish to thank Abdeslam Maghraoui for his contin-ued help and insights and MichaelAsh, Jennifer Eichberger, and Cyd Fremmer forinvaluable research assistance. Henry Aaron, William Dickens, Claudia Goldin,Edward Glaeser, Lawrence Katz, Robert Merton, Anand Swamy, and an anony-mous referee made extensive comments on earlier drafts for which the authors areparticularly grateful. They also thank Robert Akerlof, Abhijit Banerjee, KaushikBasu, Paul Beaudry, Samuel Bowles, Robert Boyd, Gary Burtless, AlessandraCasella, Catherine Eckel, Stuart Elliott, Gary Fields, Pierre Fortin, James Foster,Richard Harris, Victoria Hattam, Peter Howett, Aurora Jackson, Kevin Lang,George Loewenstein, Glenn Loury, Michael Kremer, David Laibson, Janet Pack,Matthew Rabin, Francisco Rodriguez, Paul Romer, Eric Verhoogen, Eric Wanner,Kent Weaver, Robin Wells, Janet Yellen, and Peyton Young for help and comments.George Akerlof is grateful to the Canadian Institute for Advanced Research, theMacArthur Foundation, the Brookings Institution, and the National ScienceFoundation, under research grant number SBR 97-09250, for financial support.Rachel Kranton expresses her gratitude to the Russell Sage Foundation where shewas a Visiting Scholar for 1997–1998.
� 2000 by the President and Fellows of Harvard College and the Massachusetts Institute ofTechnology.The Quarterly Journal of Economics, August 2000
715
hou
sewives
forw
riting
Th
eF
emin
ine
Mystiqu
e.O
ther
problems
such
aseth
nic
and
racialcon
flict,
discrimin
ation,
intractable
labordispu
tes,and
separatistpolitics
allinvite
aniden
tity-basedan
alysis.Becau
seof
itsexplan
atorypow
er,num
erous
scholars
inpsych
ology,sociology,
politicalscien
ce,an
thropology,
and
history
have
adoptediden
tityas
acen
tralconcept.T
his
papersh
ows
how
identity
canbe
brough
tin
toecon
omic
analysis,
allowin
ga
new
viewofm
any
econom
icproblem
s. 1W
ein
corporateiden
tityin
toa
generalm
odelofbehavior
and
then
demon
stratehow
identity
influen
cesecon
omic
outcom
es.Specifi
cally,we
consider
gender
discrimin
ationin
the
laborm
ar-ket,
the
hou
sehold
divisionof
labor,an
dth
eecon
omics
ofsocial
exclusion
and
poverty.In
eachcase,
our
analysis
yieldspredic-
tions,
supported
byexistin
geviden
ce,th
atare
different
fromth
oseofexistin
gecon
omic
models.T
he
Con
clusion
indicates
man
yoth
errealm
sw
here
identity
almost
surely
matters.
Our
identity
model
ofbeh
aviorbegin
sw
ithsocial
difference.
Gen
der,auniversally
familiar
aspectofidentity,illu
strates.There
aretw
oabstract
socialcategories,
‘‘man
’’an
d‘‘w
oman
.’’T
hese
categoriesare
associatedw
ithdifferen
tideal
physical
attributes
and
prescribedbeh
aviors.Everyon
ein
the
population
isassign
eda
gender
category,as
either
a‘‘m
an’’
ora
‘‘wom
an.’’
Follow
ing
the
behavioral
prescriptions
foron
e’sgen
deraffirm
son
e’sself-
image,
oriden
tity,as
a‘‘m
an’’or
asa
‘‘wom
an.’’ 2
Violatin
gth
eprescription
sevokes
anxiety
and
discomfort
inon
eselfan
din
1.P
revious
econom
icliteratu
reon
identity
inclu
desF
olbre[1994]
who
discusses
the
importan
ceof
gender
identity
forcollective
actionth
atpreserves
male
privilege.O
ur
general
model
ofutility
allows
forth
isou
tcome,
asw
ellas
man
yoth
ersou
rcesof
gender
inequ
ality.Sen
[1985]m
ention
siden
tityas
anin
fluen
ceon
goalach
ievemen
t,bu
tdoes
not
incorporate
identity
into
autility
function
orm
odelsofspecifi
cecon
omic
settings.‘‘Iden
tity’’alsohas
other
connota-
tions:L
anda
[1994]and
Kevan
e[1994]con
siderhow
identity,defi
ned
asm
ember-
ship
ina
particular
group,affects
econom
ictran
sactions
when
individu
almem
bersare
subject
togrou
psan
ctions.
Bow
lesan
dG
intis
[1997]likew
isecon
sidercooperation
with
ina
comm
unity.
2.W
euse
the
word
prescriptionsrath
erth
ann
ormsbecau
sepreviou
susage
inecon
omics
has
giventh
elatter
termcon
notation
sth
atw
ould
bem
isleading
inth
econ
textof
this
paper.H
ere,agen
tsfollow
prescriptions,
forth
em
ostpart,
tom
aintain
their
self-concepts.
Incon
trast,in
much
ofth
eecon
omics
literature,
anorm
isobeyed
because
failure
todo
soresu
ltsin
punish
men
t(e.g.,A
kerlof[1976],K
andori
[1992],an
dC
ole,M
ailath,
and
Postlew
aite[1992]).
Oth
erau
thors,
how
ever,see
norm
sas
someth
ing
similar
toou
rprescription
s.In
Mon
tgomery’s
[1997]gam
e-theoretic
model
ofsocial
roles,agen
tsadopt
strategiesth
atnorm
sassign
their
rolesbecau
seoth
erwise
they
‘‘wou
ldnot
recognize
them
selves.’’Elster
[1989]writes
thatsocialn
orms
aresu
stained
bystron
gfeelin
gsofem
barrassmen
t,an
xiety,an
dgu
iltsuffered
fromviolatin
gth
em.
Huan
gan
dW
u[1994]
alsocon
sidersocial
norm
ssu
stained
bypeople’s
emotion
s,w
hich
inth
eview
ofth
ispaper
wou
ldresu
ltfrom
aperson
’ssen
seofself.
QU
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OU
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AL
OF
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ON
OM
ICS
716
others.G
ender
identity,th
en,ch
anges
the
‘‘payoffs’’fromdifferen
taction
s.T
his
modelin
gof
identity
isin
formed
bya
vastbody
ofresearch
onth
esalien
ceof
socialcategories
forhum
anbeh
avioran
din
teraction.
We
present
inth
enext
sectiona
seriesof
examples
ofidentity-related
behavior.T
hese
examples,an
doth
ereviden
ce,in
dicateth
at(1)
peoplehave
identity-based
payoffsderived
fromth
eirow
naction
s;(2)
peoplehave
identity-based
payoffsderived
fromoth
ers’actions;(3)th
irdparties
cangen
eratepersisten
tch
anges
inth
esepayoffs;
and
(4)som
epeople
may
choose
their
identity,bu
tch
oicem
aybe
proscribedfor
others.
The
concept
ofidentity
expands
econom
ican
alysisfor
atleast
four
correspondin
greason
s.F
irst,identity
canexplain
behavior
thatappears
detrimen
tal.P
eoplebeh
avein
ways
that
wou
ldbe
considered
maladaptive
oreven
self-destructive
byth
osew
ithoth
eriden
tities.The
reasonfor
this
behavior
may
beto
bolstera
sense
ofself
orto
salvea
dimin
ished
self-image.
Secon
d,iden
tityunderlies
anew
typeof
externality.
One
person’s
actions
canhave
mean
ing
foran
devoke
responses
inoth
ers.G
ender
againaffords
anexam
ple.Adress
isa
symbol
offem
inin
ity.Ifam
anw
earsa
dress,this
may
threaten
the
identity
ofoth
erm
en.
There
isan
externality,
and
furth
erextern
alitiesresu
ltifth
esem
enm
akesom
erespon
se.T
hird,
identity
revealsa
new
way
that
preferences
canbe
chan
ged.Notion
sof
identity
evolvew
ithin
asociety
and
some
inth
esociety
have
incen
tivesto
man
ipulate
them
.O
bvious
ex-am
plesoccu
rin
advertising
(e.g.,M
arlboroads).
As
we
shall
explore,th
ereare
man
yoth
ercases,
inclu
ding
public
policies,w
here
chan
ging
socialcategories
and
associatedprescription
saffects
econom
icou
tcomes.
Fou
rth,becau
seiden
tityis
fundam
entalto
behavior,ch
oiceof
identity
may
beth
em
ostim
portant
‘‘econom
ic’’decisionpeople
make.
Individu
alsm
ay—m
oreor
lesscon
sciously—
choose
who
they
wan
tto
be.L
imits
onth
isch
oicem
ayalso
beth
em
ostim
portant
determin
ant
ofan
individu
al’secon
omic
well-bein
g.P
revious
econom
ican
alysesof,for
example,poverty,labor
supply,
and
schoolin
ghave
not
considered
these
possibilities.O
ur
analysis
proceedsas
follows.
Inth
enext
sectionw
epropose
agen
eralutility
function
that
incorporates
identity
asa
motivation
forbeh
avior.Itintrodu
cesth
evocabu
laryan
dth
eoreti-cal
framew
orkused
throu
ghou
tth
epaper.
This
sectionalso
EC
ON
OM
ICS
AN
DID
EN
TIT
Y717
justifi
esou
rin
clusion
ofidentity
ina
utility
function
,presentin
ga
seriesof
examples
ofiden
tity-relatedbeh
avior.Section
IIIth
encon
structs
aprototype
game-th
eoreticm
odelof
identity
that
mirrors
standard
psychological
theory.
This
model
oftw
osocial
categories—G
reenan
dR
ed—con
tains
the
essential
elemen
tsof
socialdifferentiation
,identity,an
decon
omic
interaction
.Section
sIV,V,an
dV
Icon
sidergen
derdiscrim
ination
inth
elabor
market,
the
econom
icsof
povertyan
dsocial
exclusion
,and
the
hou
sehold
divisionoflabor,respectively.S
ectionV
IIcon
cludes
and
indicates
directions
forfu
ture
research.
II.U
TIL
ITY
FU
NC
TIO
NA
ND
EV
IDE
NC
EO
F
IDE
NT
ITY-R
EL
AT
ED
BE
HA
VIO
R
This
sectionproposes
autility
function
that
incorporates
identity
asa
motivation
forbeh
avior.We
drawon
extensive
work
inpsych
ologyan
ddiscu
ssspecifi
cexam
plesof
behavior
that
support
our
framew
ork.
A.A
Utility
Fu
nction
with
Iden
tity
Inou
rutility
function
,identity
isbased
onsocial
categories,C
.Each
personjh
asan
assignm
entofpeople
toth
esecategories,
cj ,so
that
eachperson
has
acon
ceptionofh
erow
ncategories
and
that
ofall
other
people. 3P
rescriptions
Pin
dicateth
ebeh
aviorappropriate
forpeople
indifferen
tsocial
categoriesin
different
situation
s.The
prescriptions
may
alsodescribe
anideal
foreach
categoryin
terms
ofphysicalch
aracteristicsan
doth
erattribu
tes.C
ategoriesm
ayalso
have
high
eror
lower
socialstatus.W
euse
the
word
identity
todescribe
botha
person’s
self-image
asw
ellasher
assigned
categories.G
ender
identity,
asin
dicatedearlier,
could
beform
alizedas
follows.T
here
isa
setofcategories
C,‘‘m
an’’an
d‘‘w
oman
,’’where
men
have
high
ersocial
status
than
wom
en.c
j describesj’s
own
gender
categoryas
wellas
j’sassign
men
tfor
everyone
elsein
the
population
.Passociates
toeach
categorybasic
physicalan
doth
erch
aracteristicsth
atcon
stitute
the
idealman
orw
oman
asw
ellasspecifi
esbeh
aviorin
differentsitu
ations
according
togen
der.E.g.,
the
idealwom
anis
female,th
in,an
dsh
ould
always
wear
adress;
3.A
nin
dividual
j’sm
apping
ofanoth
erin
dividualk
into
categoriesneed
not
correspond
tok’s
own
mappin
g.Inaddition
,socialcategoriesneed
not
bem
utu
allyexclu
sive,an
dan
individu
alm
aybe
mapped
into
severalsocial
categories(e.g.,
individu
aljis
botha
‘‘wom
an’’an
da
‘‘professional’’).
QU
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ON
OM
ICS
718
the
idealm
anis
male,m
uscu
lar,and
shou
ldnever
wear
adress,
exceptperh
apson
Hallow
een.
We
proposeth
efollow
ing
utility
function
:
(1)U
j �U
j (aj ,a
�j ,I
j ).
Utility
depends
onj’s
identity
orself-im
ageI
j ,asw
ellas
onth
eusu
alvectors
ofj’s
actions,
aj ,
and
others’action
s,a
�j .
Sin
cea
j
and
a�
j determin
ej’s
consu
mption
ofgoods
and
services,th
eseargu
men
tsan
dU
j (·)aresufficien
ttocaptu
reth
estan
dardecon
om-
icsofow
naction
san
dextern
alities.F
ollowin
gou
rdiscu
ssionabove,
we
proposeth
efollow
ing
representation
ofIj :
(2)I
j �I
j (aj ,a
�j ;c
j ,�j ,P
).
Aperson
j’siden
tityI
j depends,fi
rstof
all,onj’s
assigned
socialcategories
cj .
The
socialstatu
sof
acategory
isgiven
byth
efu
nction
Ij (·),an
da
personassign
eda
categoryw
ithhigh
ersocial
status
may
enjoy
anen
han
cedself-im
age.Iden
tityfu
rther
de-pen
dson
the
extent
tow
hich
j’sow
ngiven
characteristics
�j
match
the
idealofj’s
assigned
category,indicated
byth
eprescrip-
tions
P. 4
Fin
ally,identity
depends
onth
eexten
tto
which
j’sow
nan
doth
ers’actions
correspond
toprescribed
behavior
indicated
byP
.W
ecall
increases
ordecreases
inutility
that
derivefrom
Ij ,
gains
orlosses
inid
entity. 5
Inth
esim
plestcase,
anin
dividual
jch
oosesaction
sto
maxim
izeutility
(1),taking
asgiven
cj ,�
j ,and
Pan
dth
eaction
sof
others.W
euse
the
verb‘‘ch
oose’’advisedly.We
donotpresu
me
one
way
oran
other
that
peopleare
aware
oftheir
own
motivation
s,asin
standard
utility
theory
which
isagn
osticas
tow
heth
eran
individu
alshopper
isaw
areor
not
ofthe
reasons
forher
choices. 6
Beyon
daction
s,tosom
eexten
tan
individu
almay
alsoch
ooseth
ecategory
assignm
ent
cj .S
ocialcategoriesm
aybe
more
orless
ascriptive,an
din
general,
the
individu
alis
likelyto
have
some
4.In
the
caseofa
categoryw
ithhigh
(low)socialstatu
s,aperson
jmay
gainw
hen
own
characteristics
areclose
to(far
from)from
the
ideal.5.
Sin
cean
individu
al’sself-con
ceptm
aybe
formed
byseein
gon
eselfthrou
ghth
eeyes
ofothers
[Gleitm
an1996,p.343],th
esegain
sor
lossesm
ayalso
depend
onhow
others
interpret
i’saction
s.The
opinion
sof
others
may
berevealed
throu
ghaction
sa
�j ;th
ein
dividualm
ayalso
careabou
toth
ers’categorizations
c�
j .6.
Sen
[1997]m
akesth
ean
alogyth
atligh
tdoes
not
know
that
itis
min
imizin
gdistan
ce,bu
tbeh
avesas
ifit
does.T
his
notion
follows
Friedm
an’s
[1953]dicta
forth
em
ethodology
ofpositive
econom
ics.W
heth
eror
not
jcon
-sciou
slyrealizes
she
ism
aximizin
ga
utility
function
such
as(1),
she
doesso
neverth
eless.In
our
setting,
inparticu
lar,th
em
otivations
forbeh
aviorm
aybe
uncon
scious.
EC
ON
OM
ICS
AN
DID
EN
TIT
Y719
choice
overiden
tity,asin
deedpeople
may
evenhave
some
choice
overth
eirgen
der.A
gain,
this
‘‘choice’’
may
bem
oreor
lesscon
scious.
Individu
alactions
may
alsoaffect
the
prescriptions
P,th
eset
ofsocialcategories
C,as
wellas
the
status
ofdifferen
tcategories
reflected
inI
j (·).W
ithrespect
togen
der,for
example,
status
differences
between
men
and
wom
enhave
dimin
ished
overtim
e,an
dprescribed
behavior
and
physical
idealshave
chan
ged.Gen
-der
categoriesth
emselves
have
become
variedan
dcom
plex.There
may
beno
universal
agreemen
tabou
tsocial
categoriesan
dprescription
s.In
deed,th
eyare
the
subject
ofm
uch
debatean
dcon
troversy.
B.P
sychology
and
Experim
ents
onG
roup
Iden
tification
The
promin
ence
ofiden
tityin
psychology
suggests
that
econom
istssh
ould
consider
identity
asan
argum
ent
inutility
function
s.P
sychologists
have
long
positeda
selfor
‘‘ego’’as
aprim
aryforce
ofindividu
albehavior.T
hey
have
furth
erassociated
anin
dividual’s
sense
ofselftoth
esocialsettin
g;identity
isbou
nd
tosocial
categories;and
individu
alsiden
tifyw
ithpeople
insom
ecategories
and
differentiate
them
selvesfrom
those
inoth
ers. 7W
hile
experimen
tsin
socialpsych
ologydo
not
show
the
existence
ofa
‘‘self’’orth
isiden
tification
perse,
they
dodem
on-
strateth
ateven
arbitrarysocial
categorizations
affectbeh
avior. 8C
onsider
the
Robbers
Cave
experimen
t.In
itsin
itialw
eek,tw
ogrou
psof
boysat
asu
mm
ercam
pin
Oklah
oma
were
keptapart.
Durin
gth
isperiod,
the
boysdeveloped
norm
sof
behavior
and
identities
asbelon
ging
toth
eirgrou
p.W
hen
they
met
fora
tourn
amen
tin
the
second
week,th
eeleven
-year-oldequ
ivalentof
war
brokeou
t,w
ithnam
e-calling,
stereotyping,
and
figh
ting.
Later
experimen
tssh
owth
atcom
petitionis
not
necessary
forgrou
piden
tification
and
eventh
em
ostmin
imalgrou
passign
men
tcan
affectbeh
avior.‘‘Grou
ps’’formby
noth
ing
more
than
random
assignm
entofsu
bjectsto
labels,such
aseven
orodd.S
ubjects
arem
orelikely
togive
rewards
toth
osew
ithth
esam
elabel
than
toth
osew
ithoth
erlabels,
evenw
hen
choices
arean
onym
ous
and
have
no
impacton
own
payoffs.Subjects
alsohave
high
eropin
ions
ofmem
bersofth
eirow
ngrou
p.
7.F
ordiscu
ssionofth
e‘‘self,’’see
Thom
as[1996],B
reger[1974],or
Gleitm
an[1996].
For
areview
ofth
esocial
psychology
ofiden
tity,see
Brow
n[1986]
and
Weth
erell[1996],and
especiallyth
ew
orkofTajfelan
dTu
rner
[1979].8.
For
discussion
ofsocial
psychology
experimen
ts,see
Brow
n[1986,
pp.541–566]an
dW
etherell[1996,pp.203–216].
QU
AR
TE
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YJ
OU
RN
AL
OF
EC
ON
OM
ICS
720
Our
modelin
gofiden
tityexactly
parallelsth
eseexperim
ents.
Inth
eexperim
ents,as
inou
rutility
function
(1),there
aresocial
categories;th
ereis
anassign
men
tof
subjects
toth
osesocial
categories;finally,su
bjectshave
inm
ind
some
formofassign
men
t-related
prescriptions,
elserew
ardsw
ould
not
depend
ongrou
passign
men
t.
C.E
xamples
ofIden
tity-Related
Beh
avior
We
next
present
aset
of‘‘real-w
orld’’exam
plesof
four
differentw
ays,outlin
edin
the
introdu
ctionan
dform
alizedin
our
utility
function
,that
identity
may
influen
cebeh
avior.O
ur
first
setdem
onstrates
that
peoplehave
identity-related
payoffsfrom
their
own
actions.
The
impact
ofan
actiona
jon
utility
Uj depen
dsin
parton
itseffect
oniden
tityI
j .
Self-M
utilation
.T
he
first
ofth
eseexam
plesis
perhaps
the
most
dramatic:
peoplem
utilate
their
own
orth
eirch
ildren’s
bodiesas
anexpression
ofiden
tity.Tattooing,body-piercin
g(ear,
nose,
navel,
etc.),hair
conkin
g,self-starvation
,steroid
abuse,
plasticsu
rgery,an
dm
alean
dfem
alecircu
mcision
allyield
physical
markers
ofbelon
ging
tom
oreor
lessexplicit
socialcategories
and
groups. 9
Interm
sof
our
utility
function
,th
esepractices
transform
anin
dividual’s
physical
characteristics
tom
atchan
ideal. 10T
he
mutilation
may
occur
because
peoplebelieve
itleads
topecu
niary
rewards
and
interaction
ssu
chas
marriage.B
utth
eten
acityan
ddefen
seofth
esepractices
indicate
the
extent
tow
hich
belongin
grelies
onritu
al,an
dpeople
have
intern
alizedm
easures
ofbeauty
and
virtue. 11
Gen
der
and
Occu
pations.
Fem
aletrial
lawyer,
male
nurse,
wom
anM
arine—
allcon
jure
contradiction
s.W
hy?
Becau
setrial
9.See
Khatibi
[1986]for
analysis
ofhow
markin
gth
ebody,by
circum
cisionan
dtribaltattoos,m
arksth
eself.
10.A
naltern
ativeexplan
ationis
that
these
practicesare
signals
ofsom
eunobserved
econom
icallyrelevan
tattribu
te.H
owever,
itis
hard
toim
agine
why
individu
alcostsofth
esesign
alsw
ould
becorrelated
with
these
attributes.
11.In
astu
dyofsexu
alityin
ruralE
gypt,Khattab
[1996]reportsth
atw
omen
consider
female
circum
cisiona
beautifyin
gpractice.It
accentu
atesth
edifferen
cebetw
eenth
esexes:‘‘W
edon
’tw
ant
tolook
likea
man
with
aprotru
ding
organ’’[p.
20].Bum
iller[1990]
reportsan
example
offem
aledefen
seof
female
self-sacrifice.
Both
men
and
wom
enjou
rneyed
topay
their
respectsafter
ayou
ng
wom
ancom
mitted
satiin
aR
ajasthan
ivillage
in1987.
Sati
isth
epractice
ofth
ew
idowbu
rnin
gto
deathon
her
husban
d’sfu
neral
pyre.O
ne
devoteeexpressed
her
admiration
:‘‘IfIhad
know
nsh
ew
asgoin
gto
doth
isIw
ould
have
touch
edher
feet.N
owIw
illgiveher
aplace
inm
yhou
sean
dw
orship
her
everyday.’’T
his
respectis
no
lessdim
inish
edby
admirers’dou
btsth
atthey
wou
ldhave
had
the
same
courage
orby
their
ignoran
ceofth
epressu
reon
the
widow
fromher
in-law
s.
EC
ON
OM
ICS
AN
DID
EN
TIT
Y721
lawyers
areview
edas
mascu
line,
nurses
asfem
inin
e,an
da
Marin
eas
the
ultim
atem
an.P
eoplein
these
occupation
sbu
tof
the
oppositesex
oftenhave
ambigu
ous
feelings
about
their
work.
Interm
sof
our
utility
function
,an
individu
al’saction
sdo
not
correspond
togen
derprescription
sof
behavior.A
revealing
study
inth
isregard
isP
ierce’s[1995]
participant-observer
researchon
the
legalprofession
. 12F
emale
lawyers
thou
ght
ofth
emselves
asw
omen
,yetbeing
agood
lawyer
mean
tacting
likea
man
.Law
yersw
eretold
intrain
ing
sessions
toact
like‘‘R
ambo’’an
dto
‘‘takeno
prisoners.’’In
the
office,trialattorneys
who
didnot
‘‘win
big’’were
describedas
‘‘havin
gno
balls.’’In
timidation
ofw
itnesses
was
‘‘mach
oblasts
against
the
other
side.’’AC
hristm
asskit
abouttw
opartn
ersdram
atizedth
egen
dercon
flict:
[O]n
esecretary
dressedup
asR
achel
and
anoth
erdressed
up
asM
ichael.T
he
secretaryportrayin
gM
ichael...ran
around
the
stagebarkin
gorders
and
singin
g,‘‘I’mM
ichaelB
ond,I’m
such
abu
sym
an.I’m
such
abu
sym
an.’’T
he
other
secretaryfollow
edsu
itby
barking
ordersan
dsin
ging,‘‘I’m
Rach
elR
osen,I’m
such
abu
sym
an,I
mean
wom
an.I’m
such
abu
sym
an,I
mean
wom
an....’’M
ichael
responded
toth
espoof
instride....
Rach
el,on
the
other
han
d,was
veryupset
[Pierce,1995,p.130].
Fem
alelaw
yersexpressed
their
ambivalen
cein
man
ydiscu
s-sion
s.‘‘C
andace,’’an
other
partner,
toldP
ierce:‘‘I
had
forgottenhow
much
anger
I’vebu
riedover
the
yearsabou
tw
hat
happen
edto
the
wom
anw
ho
became
alaw
yer....To
bea
lawyer,
some-
where
along
the
way,I
made
adecision
that
itm
eantactin
glike
am
an.To
doth
atIsqu
eezedth
efem
alepart
ofme
into
abox,pu
ton
the
lid,and
tucked
itaw
ay’’[Pierce
1995,p.134].
Alu
mn
iG
iving.
Charitable
contribu
tions
may
yielda
‘‘warm
glow’’[A
ndreon
i1989],buthow
dopeople
choose
one
organization
overan
other?
Charity
toth
eorgan
izationw
ithth
ehigh
estm
arginalretu
rnw
ould
maxim
izeits
econom
icim
pact.Yet,atleastfor
high
eredu
cation,
contribu
tions
may
well
reflect
identity.
Gradu
atesgive
toth
eirow
nalm
am
ater.A
lum
ni
giving
could
enhan
ceth
evalu
eof
adegree
bym
aintain
ing
anin
stitution
’srepu
tation.B
utth
isexplan
ationsuffers
fromth
ecollective
actionproblem
.And
itdoesnotaccou
ntfor
studen
tloyaltyan
diden
tifica-
tionw
ithan
institu
tion,as
expressedin
such
lyricsas
‘‘For
God,
forcou
ntry,an
dfor
Yale.’’
12.F
ora
study
ofnurses
and
Marin
es,seeW
illiams
[1989].
QU
AR
TE
RL
YJ
OU
RN
AL
OF
EC
ON
OM
ICS
722
Mou
ntain
eering.
Why
dopeople
climb
mou
ntain
s?L
oewen
-stein
[1998]argues
thatfacin
gth
eextrem
ediscom
fortand
danger
ofmou
ntain
eering
enhan
cesan
individu
al’ssen
seofself.
Our
second
setof
examples
demon
stratesth
atpeople
have
identity-related
payoffsfrom
others’
actions.
The
effectof
anaction
a�
j onutility
inclu
desan
impact
onI
j .
Gen
der
and
Occu
pations.
Aw
oman
workin
gin
a‘‘m
an’s’’job
may
make
male
colleagues
feelless
like‘‘m
en.’’To
allayth
esefeelin
gs,they
may
actto
affirmth
eirm
asculin
ityan
dact
against
female
coworkers.In
her
study
ofcoalh
andlers
ina
power
plant,
Padavic
[1991]interpreted
the
behavior
ofher
male
coworkers
inth
isw
ay.On
one
occasion,th
eypicked
her
up,tossed
her
backan
dforth
,an
dattem
ptedto
push
her
onto
the
coalcon
veyerbelt
(jokingly,ofcou
rse).Inth
ecase
ofanoth
erw
orker,no
one
trained
her,
no
one
helped
her,
and
when
she
askedfor
help,
she
was
refused
assistance
that
wou
ldhave
beenrou
tine
form
alecow
orkers. 13To
furth
erassay
the
reasons
forsu
chbeh
avior,w
etook
aran
dom-sam
pleteleph
one
survey
relating
avign
etteabou
ta
female
carpenter
ata
constru
ctioncom
pany
who
was
‘‘baitedan
dteased’’by
am
alecow
orker.We
seein
TableI
that
amon
gth
esix
possibleexplan
ations,
84percen
tof
the
responden
tssaid
itw
as‘‘som
ewhat
likely,’’‘‘likely,’’or‘‘very
likely’’that
the
male
worker
behaved
inth
isw
aybecau
sehe
feltless
mascu
line. 14
This
explanation
was
one
ofth
em
ostpopu
lar,an
dm
oreth
anth
ree-qu
artersof
the
responden
tsth
ough
tth
ata
wom
anin
am
an’s
job‘‘frequ
ently’’or
‘‘almost
always’’faces
such
treatmen
t.
Man
hood
and
Insu
lt.F
ora
man
,anaction
may
beview
edas
anin
sult
which
,ifleft
unan
swered,im
pugn
shis
mascu
linity.A
sin
the
example
above,an
actiona
�j
impacts
Ij
which
may
becou
ntered
byan
actiona
j .Psych
ologistsN
isbettan
dC
ohn
[1996]have
detectedsu
chiden
titycon
cerns
inexperim
ents
atth
e
13.L
evine
[1997]also
found
that
men
oftenrefu
sedto
trainw
omen
and
sabotagedth
eirw
ork.In
addition,
wom
enin
men
’sjobs
were
subject
tosexu
alin
nuen
do.For
acollection
ofsuch
examples
seeSch
ultz
[1998].14.
Differen
cesin
response
bygen
derw
erenegligible.
The
survey
inclu
dedth
reeoth
ervign
ettes,tw
oof
which
describeda
man
(wom
an)
contem
plating
asw
itchto
apredom
inan
tlyfem
ale(m
ale)occu
pation.
Respon
sesin
dicateth
atgen
dercou
ldbe
ofcon
cernin
such
adecision
.The
responses
were
unin
formative,
how
ever,when
the
switch
was
otherw
iseundesirable
soth
atan
ygen
derconfl
ictw
ould
bem
oot.R
esponses
toth
elast
vignette
strongly
suggest
that
identity
consideration
sare
am
ajorreason
fortakin
gth
etim
eto
vote.Our
sample
was
half
male,h
alffemale,an
d60
percentcollege
graduates.
EC
ON
OM
ICS
AN
DID
EN
TIT
Y723
University
ofM
ichigan
.T
hese
experimen
ts,th
eyargu
e,reveal
remnan
tsof
the
white
antebellu
mSou
thern
‘‘cultu
reof
hon
or’’indisparate
reactions
toin
sult
ofm
alesfrom
the
U.S
.Sou
than
dN
orth. 15
Their
experimen
tsin
volvedvariation
sof
the
followin
g
15.F
ora
descriptionof
this
‘‘cultu
reof
hon
or,’’seealso
Butterfi
eld[1995].
‘‘Gen
tlemen
’’reactedto
insu
ltby
engagin
gin
duels.
Those
oflow
erclass
fough
tw
ithhan
dsan
dfists
with
no
holds
barred,so
that
figh
tsexten
dedto
such
extremities
aseyes,ears,an
dnose.
TA
BL
EI
VIG
NE
TT
EC
ON
CE
RN
ING
HA
RA
SSM
EN
TA
ND
EV
AL
UA
TIO
NO
FP
OSSIB
LE
EX
PL
AN
AT
ION
S
Vign
ette:Pau
lisa
carpenter
fora
constru
ctioncom
pany.T
he
compan
yhas
just
hired
Christin
e,itsfirst
female
carpenter,for
3dollars
lessper
hou
rth
anit
paysP
aulan
dth
eoth
ercarpen
ters.On
Christin
e’sfirst
dayofw
ork,Pau
land
two
ofhis
coworkers
baitan
dtease
Christin
e,makin
git
difficult
forher
todo
her
job.Try
toim
agine
why
Pau
lbehaved
ashe
did.Rate
eachofth
efollow
ing
explana-
tions
forP
aul’s
behavior
asnot-at-alllikely,n
otlikely,som
ewhat
likely,likely,or
verylikely.
Explan
ation
Fraction
somew
hat
likely,likely,or
verylikely
a,bAveragescore
c
Pau
lputC
hristin
edow
nbecau
sehe
isafraid
that
byhirin
ga
wom
anth
ecom
pany
canlow
erhis
wage.
.36(.06)
2.5(.12)
Pau
lputC
hristin
edow
nbecau
sehe
doesnot
feelthat
itis
fairth
atC
hristin
eis
getting
alow
erw
age..13
(.04)1.7
(.12)P
aulpu
tC
hristin
edow
nbecau
sehe
feelsless
mascu
-lin
ew
hen
aw
oman
isdoin
gth
esam
ejob.
.84(.04)
3.4(.12)
Pau
lputC
hristin
edow
nbecau
sehe
feelshe
and
his
friends
willn
otbe
ableto
jokearou
nd
ifaw
oman
ispresen
t.
.84(.04)
3.6(.12)
Pau
lputC
hristin
edow
nbecau
sehe
isafraid
that
other
men
willtease
him
ifaw
oman
isdoin
gth
esam
ejob.
.76(.05)
3.3(.13)
Pau
lputC
hristin
edow
nbecau
sehe
isafraid
that
peoplew
illthin
kth
athis
jobrequ
iresless
skillifaw
oman
isdoin
gth
esam
ejob.
.64(.06)
2.9(.12)
Pau
lputC
hristin
edow
nbecau
sehe
isafraid
that
ifhe
doesnot,th
enhis
male
coworkers
willstart
totease
him
.
.80(.05)
3.4(.13)
Pau
lputC
hristin
edow
nbecau
sehe
feelsth
atit
isw
rong
forw
omen
tow
orkin
am
an’s
job..77
(.05)3.2
(.14)
a.Sam
plesize
is70
hou
seholds.H
ouseh
oldsw
ereselected
random
lyfrom
the
Frem
ont,C
Aph
onebook.
b.Stan
darderrors
arein
parenth
eses.c.A
veragew
ithnot-at-alllikely
�1,n
otlikely
�2,som
ewhat
likely�
3,likely�
4,verylikely
�5.
QU
AR
TE
RL
YJ
OU
RN
AL
OF
EC
ON
OM
ICS
724
scenario:
anassociate
ofth
eexperim
enters
bum
pedsu
bjectsin
the
hallw
ayas
they
made
their
way
toth
eexperim
ent.
Rath
erth
anapologizin
g,th
eassociate
calledth
esu
bject‘‘assh
ole.’’In-
sulted
Sou
thern
ersw
erem
orelikely
than
insu
ltedN
orthern
ersan
dcon
trolSou
thern
ersto
fill
insu
bsequen
tw
ord-completion
testsw
ithaggressive
words
(forexam
ple,g-un
rather
than
f-un)
and
had
raisedcortisollevels.
Most
revealing
that
the
insu
ltaffected
identity,
insu
ltedSou
thern
ersw
erealso
more
likelyto
fearth
atth
eexperim
enter
had
alow
opinion
ofth
eirm
asculin
ity.T
hey
will
probablynever
meet
the
experimen
teror
the
hallw
ayaccom
pliceagain
;th
eiren
counter
inth
eexperim
ent
isoth
erwise
anon
ymou
s.T
heir
concern
about
the
experimen
terth
encan
only
bea
concern
about
how
they
feelaboutth
emselves,abou
tth
eirow
nsen
seofiden
tity,as
perceivedth
rough
the
‘‘mirror
ofthe
opinion
san
dexpectation
sofoth
ers’’[Gleitm
an1996,p.343].W
esee
the
same
psychology
inoth
erexam
ples.
Ch
angin
gG
roups
orV
iolating
Prescription
s.B
ecause
ofj’s
iden
tification
with
others,it
may
affectj’s
identity
when
anoth
erperson
inj’s
socialcategory
violatesprescription
sor
becomes
adifferen
tperson
. 16A
comm
onrespon
seis
scornan
dostracism
,w
hich
distances
oneself
fromth
em
averickan
daffirm
son
e’sow
nself-im
age.Such
behavior
occurs
dailyin
school
playgrounds,
where
children
who
behave
differently
arem
ockedan
dtau
nted.
Those
who
seekupw
ardm
obilityare
oftenteased
byth
eirpeers,
asin
AH
opein
the
Un
seen[S
uskin
d1998],w
hich
describesC
edricJen
nin
gs’progressfrom
one
ofW
ashin
gton’s
most
blighted
high
schools
toB
rown
University.
The
bookopen
sw
ithC
edricin
the
high
-schoolch
emistry
lab,escaping
the
catcallsofth
ecrow
dat
anaw
ardsassem
bly.T
hose
who
tryto
chan
gesocial
categoriesan
dprescription
sm
ayface
similar
derisionbecau
seth
ech
ange
may
devalue
others’iden
tity,asfor
the
hou
sewives
inB
ettyF
riedan’s
subu
rb.
Our
third
setof
examples
demon
stratesth
atto
some
extent
peoplech
ooseth
eiriden
tity;that
is,cj m
aybe
partiallya
choice.
Man
yw
omen
inth
eU
nited
States
canch
ooseeith
erto
bea
careerw
oman
ora
hou
sewife
(seeG
erson[1986]).P
arents
oftench
oosea
school—
public
versus
private,secular
versus
parochial—
toin
flu-
16.W
ediscu
ssth
epsych
ologyofid
entifi
cationan
dits
implication
sfu
rther
inth
enext
section.
EC
ON
OM
ICS
AN
DID
EN
TIT
Y725
ence
ach
ild’sself-im
age,iden
tification
with
others,
and
behav-
ior. 17T
he
choice
ofw
here
tolive
atcollege
canboth
reflect
and
chan
gehow
studen
tsth
ink
ofthem
selves.Fratern
ities,sororities,A
frican-A
merican
,oroth
er‘‘th
eme’’-orien
teddorm
sare
allassoci-ated
with
socialgrou
ps,self-im
ages,an
dprescribed
behavior. 18
The
listcan
contin
ue.
The
choice
foran
imm
igrant
tobecom
ea
citizenis
noton
lya
chan
gein
legalstatus
buta
chan
gein
identity.
The
decisionis
thus
oftenfrau
ghtw
itham
bivalence,an
xiety,and
evengu
ilt.Iden
tity‘‘ch
oice,’’how
ever,is
veryoften
limited.
Ina
societyw
ithracialan
deth
nic
categories,forexam
ple,those
with
non
dis-tin
guish
ing
physicalfeatu
resm
aybe
ableto
‘‘pass’’asa
mem
berof
anoth
ergrou
p.B
ut
others
will
becon
strained
byth
eirappear-
ance,voice,or
accent.
Our
fourth
setof
examples
demon
stratesth
ecreation
and
man
ipulation
ofsocialcategoriesC
and
prescriptions
P. 19
Ad
vertising.
Advertisin
gis
anobviou
sattem
ptto
man
ipu-
lateprescription
s.M
arlboroan
dV
irginia
Slim
sadvertisem
ents,
forexam
ple,prom
otean
image
ofth
eideal
man
orw
oman
complete
with
the
rightcigarette. 20
Profession
alan
dG
radu
ateS
chools.
Gradu
atean
dprofes-
sionalprogram
stry
tom
oldstu
dents’beh
aviorth
rough
ach
ange
iniden
tity.As
a‘‘on
e-L’’H
arvardL
awSch
oolstuden
tsaid:‘‘‘T
hey
aretu
rnin
gm
ein
tosom
eone
else.They’re
makin
gm
edifferen
t’’’[Tu
row1977,
p.73].
Inm
edicine,
theology,
the
military,
and
the
doctorate,a
titleis
addedto
agradu
ate’snam
e,su
ggesting
the
chan
gein
person.
Political
Iden
tity.P
oliticsis
oftena
battleover
identity. 21
Rath
erth
antake
preferences
asgiven
,political
leadersan
d
17.C
atholic
schools
inth
eU
nited
States
atth
een
dofth
enin
eteenth
centu
ryw
erea
bridgebetw
eenim
migran
ts’old
European
identities
and
their
new
Am
ericanselves
[Bryk,
Lee,
and
Hollan
d1993,
p.27].
Muslim
schools,
whose
enrollm
entis
curren
tlygrow
ing,are
partlyrefu
gesfrom
public
schoolsystem
s,but
parents
alsoch
ooseth
emto
instillin
their
children
aM
uslim
identity
and
respectfor
behavioralprescription
s,and
tocou
nter
what
man
yview
asa
distortedim
ageofM
uslim
san
dIslam
inA
merica
[Sach
s1998].
18.F
oran
anth
ropologicalstudy
ofidentity,fratern
ities,and
prescriptions
forbroth
ers’behavior,see
San
day[1990].
19.T
he
socialevolu
tionan
dcon
struction
ofgrou
pdistin
ctions
and
socialcategories
isth
esu
bjectof
much
research.F
ora
survey,see
Weth
erell[1996,pp.
219–227].20.
See
deG
razia’s[1996]
volum
efor
historical
studies
ofadvertisin
gan
doth
erin
fluen
ceson
gender
and
consu
mption
.21.
For
theory
and
analysis
ofpoliticalidentity,see
Norton
[1988].
QU
AR
TE
RL
YJ
OU
RN
AL
OF
EC
ON
OM
ICS
726
activistsoften
striveto
chan
gea
population
’spreferen
cesth
rough
ach
ange
iniden
tityor
prescriptions. 22
Again
,exam
plesabou
nd.
Fascist
and
populist
leadersare
infam
ous
forth
eirrh
etoricfosterin
gracial
and
ethnic
divisions,
with
tragiccon
sequen
ces.Sym
bolicacts
and
transform
ediden
titiesspu
rrevolu
tions.
The
ringin
gof
the
Liberty
Bell
calledon
the
colonists’iden
titiesas
Am
ericans.
Gan
dhi’s
Salt
March
sparkedan
Indian
nation
aliden
tity.T
he
Fren
chR
evolution
chan
gedsu
bjectsin
tocitizen
s,an
dth
eR
ussian
Revolu
tiontu
rned
them
into
comrad
es.
III.E
CO
NO
MIC
SA
ND
IDE
NT
ITY:A
PR
OT
OT
YP
EM
OD
EL
Inth
issection
we
constru
cta
prototypem
odelof
econom
icin
teractionin
aw
orldw
here
identity
isbased
onsocialdifferen
ce.In
additionto
the
usu
altastes,
utility
fromaction
sw
illalso
depend
oniden
tity.Identity
willdepen
don
two
socialcategories—G
reenan
dR
ed—an
dth
ecorrespon
dence
ofow
nan
doth
ers’action
sto
behavioralprescription
sfor
their
category.
A.A
Prototype
Mod
el
We
beginw
ithstan
dardecon
omic
motivation
sfor
behavior.
There
aretw
opossible
activities,Activity
One
and
Activity
Two.
There
isa
population
ofin
dividuals
eachof
whom
has
ataste
foreith
erA
ctivityO
ne
orTw
o.If
aperson
with
ataste
forA
ctivityO
ne
(Two)
undertakes
Activity
One
(Two),sh
eearn
sutility
V.A
nin
dividualw
ho
chooses
the
activityth
atdoes
not
match
her
tasteearn
szero
utility.
Ina
standard
model
ofutility
maxim
ization,
eachperson
wou
lden
gagein
the
activitycorrespon
ding
toher
taste.We
next
constru
ctiden
tity-basedpreferen
ces.W
esu
pposeth
atth
ereare
two
socialcategories,
Green
and
Red.
We
assum
eth
esim
plestdivision
ofthe
population
into
categories;allpersons
thin
kof
them
selvesan
doth
ersas
Green
. 23W
eadd
simple
behavioral
prescriptions:
aG
reensh
ould
engage
inA
ctivityO
ne
(incon
trastto
Reds
who
engage
inA
ctivityTw
o).A
nyon
ew
ho
chooses
Activity
Two
isnot
a‘‘tru
e’’Green
—sh
ew
ould
loseher
22.R
omer
[1994]has
considered
the
possibilityth
atpolitician
scan
man
ipu-
latevoters’
emotion
s,in
particular
their
‘‘anger,’’
and
thereby
affectpolitical
outcom
es.23.
Ofcou
rse,itis
possibleth
atnot
everyone
thin
ksof
herself
asG
reen.W
ediscu
ssth
epossibility
ofdifferen
tiden
titiesan
doth
erexten
sions
toth
em
odelbelow
.
EC
ON
OM
ICS
AN
DID
EN
TIT
Y727
Green
identity.T
his
lossin
identity
entails
aredu
ctionin
utility
ofI
s ,w
here
the
subscript
sstan
dsfor
‘‘self.’’Inaddition
,th
ereare
identity
externalities.Ifan
iand
jarepaired,A
ctivityTw
oon
the
partof
idim
inish
esj’s
Green
identity.
jhas
aloss
inutility
Io ,
where
the
subscript
oden
otes‘‘oth
er.’’A
fteri
has
comm
ittedA
ctivityTw
o,jm
ay‘‘respon
d.’’The
response
restoresj’s
identity
ata
costc,w
hile
entailin
ga
lossto
iinam
ount
L. 24
Figu
reI
represents
anin
teractionbetw
eenan
individu
alw
itha
tastefor
Activity
One
(‘‘Person
One’’)
and
anin
dividual
with
ataste
forA
ctivityTw
o(‘‘P
ersonTw
o’’).Person
One
chooses
anactivity
first. 25
This
model
canbe
expressedby
ideascen
tralto
the
psycho-
dynam
icth
eoryof
personality,
found
inalm
ostan
ypsych
ologytext. 26
Inperson
alitydevelopm
ent,
psychologists
agreeon
the
importan
ceof
intern
alizationof
rules
forbeh
avior.F
reud
calledth
isprocess
the
developmen
tof
the
superego.
Modern
scholars
disagreew
ithF
reud
onth
eim
portance
ofpsychosexu
alfactorsin
anin
dividual’s
developmen
t,but
they
agreeon
the
importan
ceof
anxiety
that
aperson
experiences
when
she
violatesher
intern
al-ized
rules.
One’s
iden
tity,or
ego,or
self,m
ust
becon
stantly
‘‘defended
against
anxiety
inorder
tolim
itdisru
ptionan
dm
ain-
taina
sense
ofunity’’[T
hom
as1996,p.284].In
terms
ofourm
odel,P
ersonTw
o’sin
ternalization
ofprescriptions
causes
her
tosuffer
aloss
inutility
ofI
sif
she
chooses
Activity
Two.
Toavoid
this
anxiety,sh
em
ayrefrain
fromth
atactivity.
Iden
tification
isa
criticalpartofth
isin
ternalization
process:a
personlearn
sa
setof
values
(prescriptions)
such
that
her
actions
shou
ldcon
formw
ithth
ebeh
aviorof
some
peoplean
dcon
trastw
ithth
atof
others.
IfP
ersonO
ne
has
intern
alizedprescription
svia
such
identifi
cations,
anoth
erperson
’sviolation
ofth
eprescription
sw
illcau
sean
xietyfor
Person
One. 27
Inou
rm
odel,th
isan
xietyis
modeled
asa
lossin
utility
ofI
o .P
ersonO
ne’s
response,
inou
rlan
guage,
restoresher
identity,
and
interm
sof
the
psychology
textbookrelieves
her
anxiety
and
main
-
24.In
Rabin
’s[1993]th
eoryoffairn
ess,agents
arew
illing
topay
tobe
‘‘mean
’’to
those
who
are‘‘m
ean’’to
them
.The
similarity
isprobably
no
coinciden
ce.Alikely
reasonfor
such
arespon
seis
preservationofself-im
age.25.
Sin
ceP
ersonO
ne
never
chooses
Activity
Two
ina
subgam
eperfect
equilibriu
m,w
esu
ppressth
isbran
chofth
etree.
26.See,
forexam
ple,G
leitman
[1996,C
hapter
17],T
hom
as[1996],
and
Breger
[1974].27.
The
violationarou
sesem
otions
that
Person
One
has
repressedin
the
processof
intern
alizing
the
behavioral
rules.
The
psychoan
alyticth
eory,th
en,
suggests
uncon
scious
motivation
sfor
behavior.
QU
AR
TE
RL
YJ
OU
RN
AL
OF
EC
ON
OM
ICS
728
tains
her
sense
ofunity.P
ersonO
ne
no
longer
losesI
o ,althou
ghsh
edoes
incu
rc. 28
B.E
quilibriu
mO
utcom
es
There
arefou
rpossible
subgam
eperfectou
tcomes
ofthe
game
inF
igure
I.(i)
Person
One
detersP
ersonTw
ofrom
engagin
gin
Activity
Two,w
hen
c�
Io an
dI
s�
V�
Is
�L
.(ii)
Person
One
responds
but
doesnot
deterP
ersonTw
ofrom
engagin
gin
Activity
Two,w
hen
c�
Io an
dI
s�
L�
V.
(iii)Person
One
doesnot
respond,an
dP
ersonTw
oen
gagesin
Activity
Two,w
hen
c�
Io an
dI
s�
V.
(iv)Person
Two
doesnot
engage
inA
ctivityTw
oregardless
ofP
ersonO
ne’s
response,w
hen
Is
�V
.T
his
simple
model
affordsth
reelesson
s.F
irst,as
discussed
earlier,th
em
odelestablish
esth
econ
nection
between
econom
icin
teractions
and
the
psychology
ofidentity,especially
the
implica-
tions
ofid
entifi
cation.
Secon
d,th
em
odelallow
sa
comparative
staticanalysis
onidentity-related
parameters.F
inally,theelem
en-tary
assum
ptions
ofth
em
odelsu
ggestexten
sions
that
entail
greaterrealism
and
furth
erim
plications
ofiden
tityfor
econom
icin
teraction.
C.C
omparative
Statics
Com
parativestatics
show
how
traditional
econom
icpolicies
canaffect
behavior
inth
issettin
g.For
example,a
‘‘tax’’Ton
the
response
toA
ctivityTw
ow
illaffect
the
equilibriu
mou
tcome
incase
(i).F
ora
sufficiently
high
tax(T
�I
o�
c),P
ersonO
ne’s
response
toA
ctivityTw
ois
no
longer
credible,and
Person
Two
will
switch
fromA
ctivityO
ne
toA
ctivityTw
o.T
his
policyben
efits
Person
Two
atth
eexpen
seof
Person
One.
Totalutility
chan
gesfrom
Vto
2V�
Is
�I
o ,apositive
chan
geif
Vexceeds
Is
�I
o . 29A
policyw
ithth
eopposite
effectis
atax
onA
ctivityTw
oitself.T
his
policyw
ould
benefi
tP
ersonO
ne
atth
eexpen
seof
Person
Two
incases
(ii)and
(iii).Inth
efirst
(second)case,a
taxin
excessofV
�I
s�
L(V
�I
s )in
duces
Person
Two
todesist
fromA
ctivityTw
o.T
his
policyw
ould
increase
totalutility,
inth
efirst
case,if
V�
28.A
noth
erbasis
forth
em
odelis
the
psychology
ofcogn
itivedisson
ance.
When
Person
Two
engages
inA
ctivityTw
o,she
challen
gesth
evalidity
ofP
ersonO
ne’s
beliefs,an
dP
ersonO
ne
suffersfrom
cognitive
dissonan
ce.To
remove
this
dissonan
ce,Person
One
may
actagain
stP
ersonTw
o.29.
Of
course,
such
a‘‘w
elfarean
alysis’’is
subject
toth
eusu
alcaveats
concern
ing
interperson
alcomparison
san
dth
em
easurability
ofutility.
QU
AR
TE
RL
YJ
OU
RN
AL
OF
EC
ON
OM
ICS
730
c�
Is
�L
,and,in
the
second
case,ifV
�I
o�
Is .F
inally,policies
may
chan
geth
eprescription
sth
emselves.A
rhetoricalcam
paign,
forexam
ple,m
aym
akeA
ctivityTw
om
oreloath
some
toG
reens,
leading
tohigh
ervalu
esofI
s and
Io an
dgreater
conform
ityto
the
prescriptions.
Of
course,
adifferen
tcam
paigncou
ldhave
the
oppositeeffect.
These
policiesare
identity
examples
ofth
econ
flict
ofth
eP
aretianL
iberal[S
en1970].
Itis
not
possibleto
protectP
ersonO
ne
against
the
externalities
caused
byP
ersonTw
o’sch
oiceof
Activity
Two
and
atth
esam
etim
eprotect
Person
Two
fromP
ersonO
ne’s
response.
There
isa
conflict
between
protecting
individu
alsw
ho
engage
incertain
activitiesan
dsu
ppressing
these
same
activitiesth
atm
aycau
seoth
ersdiscom
fortan
dan
xiety.
D.E
xtension
sto
the
Mod
eland
the
Defi
nition
of‘‘Situ
ations’’
Differen
tassu
mption
sabou
tiden
tity,pairings,an
din
forma-
tionallyield
potentially
interestin
gexten
sions
toth
em
odel.As
inth
ebasic
model,
individu
albeh
aviorw
ould
depend
onw
hat
sociologistsw
ould
callth
e‘‘situ
ation’’—
who
ism
atched
with
whom
and
inw
hat
context. 30
Inth
ebasic
model,everyon
esh
aredth
esam
eiden
tityan
dprescription
s,bu
tth
erecou
ldbe,
more
realistically,m
any
identities
amon
gth
epopu
lation.
Activities
One
and
Two
could
have
different
mean
ings
fordifferen
tpeople.
For
example,by
choosin
gA
ctivityTw
o,aperson
could
affirmher
identity
asa
Red.
People
could
alsoch
oose—m
oreor
lesscon
-sciou
sly—th
eiriden
titiesas
wellas
their
activities.These
choices
could
depend
onth
eprobability
ofdifferen
tm
atchin
gs,or
situa-
tions. 31
We
will
exploreth
ispossibility
belowin
our
study
ofpoverty
and
socialexclusion
.F
urth
ermore,pairin
gsneed
not
beexogen
ous,n
ortastes
and
prescriptions
know
n.In
fact,much
conflict
occurs
because
peoplew
ithdifferen
tprescription
sor
identities
come
into
contact.
Toavoid
conflict
and
lossesin
utility,people
may
wan
tto
match
with
those
who
share
the
same
identity
orfor
whom
actions
have
the
same
mean
ing.
Thus,
the
match
ing
processitself—
the
‘‘situa-
30.W
hen
anin
dividual’s
identity
isassociated
with
multiple
socialcatego-
ries,th
e‘‘situ
ation’’
could
determin
e,for
example,
which
categoriesare
most
salient.
31.C
hoice
could
alsodepen
don
frequen
cyof
certainaction
s.K
uran
[1998]con
siderseth
nically
symbolic
activitiesin
am
odelw
here
peoplecare
about
belongin
gto
aneth
nic
group.
When
greateroverall
resources
aredevoted
toan
ethnic
activity,an
individu
al’sm
arginal
utility
fromth
isactivity
canin
crease,leadin
gto
an‘‘eth
nifi
cation’’cascade.
EC
ON
OM
ICS
AN
DID
EN
TIT
Y731
tions’’
inw
hich
agents
find
them
selves—can
been
dogenou
s,driven
byprescription
san
diden
tities.W
ew
illsee
this
outcom
ebelow
inou
rfirst,an
dperh
apsm
ostobviou
sapplication
.
IV.ID
EN
TIT
Y,G
EN
DE
R,A
ND
EC
ON
OM
ICS
INT
HE
WO
RK
PL
AC
E
An
identity
theory
ofgen
derin
the
workplace
expands
the
econom
ican
alysisof
occupation
alsegregation
.A
srecen
tlyas
1970,two-th
irdsof
the
United
States’fem
aleor
male
laborforce
wou
ldhave
had
tosw
itchjobs
toach
ieveoccu
pationalparity.T
his
measu
reof
occupation
alsegregation
remain
edvirtu
allyun-
chan
gedsin
ceth
ebegin
nin
gof
the
centu
ry.Yet,intw
enty
years,from
1970to
1990,this
figu
redeclin
edto
53percen
t. 32An
identity
modelpoin
tsto
chan
gesin
societalnotion
sofm
alean
dfem
aleas
am
ajorcau
se.T
he
modelw
epropose
captures
the
‘‘auras
ofgender’’[G
oldin1990a]
that
have
pervadedth
elabor
market.
Occu
pations
areassociated
with
the
socialcategories
‘‘man
’’an
d‘‘w
oman
,’’an
din
dividual
payoffsfrom
different
typesof
work
reflect
these
gender
associations.
This
model
canexplain
patterns
ofoccu
pa-tion
alsegregation
that
have
eluded
previous
models.
Italso
directlycaptu
resth
econ
sequen
cesofth
ew
omen
’sm
ovemen
tan
daffords
anew
econom
icin
terpretationofsex
discrimin
ationlaw
.Iden
tityalso
providesa
microfou
ndation
forearlier
models.
The
‘‘distaste’’ofm
enfor
workin
gw
ithw
omen
,asin
the
crudest
adaptations
ofracial
discrimin
ationm
odels[B
ecker1971;A
rrow1972],
canbe
understood
asdu
eto
lossin
male
identity
when
wom
enw
orkin
am
an’s
job.Sim
ilarlyw
omen
’sassu
med
lower
desirefor
laborforce
participation(as
inM
incer
and
Polach
ek[1974],B
ulow
and
Sum
mers
[1986],and
Lazear
and
Rosen
[1990])can
beunderstood
asth
eresu
ltofth
eiriden
tityas
hom
emakers. 33
A.T
he
Mod
el 34
There
aretw
osocial
categories,‘‘m
en’’
and
‘‘wom
en,’’
with
prescriptions
ofappropriate
activitiesfor
each.A
firm
wish
esto
32.See
Goldin
[1990a,C
hapter
3]for
historical
measu
resof
occupation
alsegregation
.See
Blau
,Sim
pson,
and
Anderson
[1998],w
ho
use
Cen
sus
Bureau
three-digit
classification
sofoccu
pations,for
1970–1990figu
res.33.
InB
ergman
n[1974],
male
employers
areaverse
tohirin
gw
omen
forparticu
larjobs
and
may
collude
tokeep
wom
enou
tof
high
paying
occupation
s,reservin
gth
egain
sfor
other
males.
Inou
rth
eory,th
esou
rceof
occupation
alsegregation
isem
piricallym
otivated—th
em
ainten
ance
ofgen
deriden
tityon
the
partofem
ployees.34.
An
appendix
with
complete
specification
ofthe
modelis
availablefrom
the
auth
orsupon
request.
QU
AR
TE
RL
YJ
OU
RN
AL
OF
EC
ON
OM
ICS
732
hire
laborto
performa
task.By
the
initialprescription
s,this
taskis
appropriateon
lyfor
men
;it
isa
‘‘man
’sjob.’’
Relative
toa
‘‘wom
an’s
job,’’wom
enlose
identity
inam
ount
Is
byperform
ing
such
work. 35
Inth
issitu
ation,m
alecow
orkerssuffer
aloss
Io . 36
They
may
relieveth
eiran
xietyby
taking
actionagain
stw
omen
coworkers, 37redu
cing
everyone’s
productivity.
Toavoid
these
productivity
losses,th
efirm
may
chan
gegen
der-jobassociation
sat
acost.
The
firm
islikely
tocreate
a‘‘w
oman
’sjob’’alon
gsideth
e‘‘m
an’s
job,’’rather
than
render
the
whole
taskgen
derneu
tral,w
hen
anew
jobdescription
canpiggyback
onexistin
gnotion
sofm
alean
dfem
ale. 38Aw
ell-know
nhistorical
example
illustrates.In
the
nin
eteenth
centu
ry,Horace
Man
n(as
Secretary
ofEdu
cationfor
Massach
usetts)tran
sformed
elemen
tarysch
oolteach
ing
into
aw
oman
’sjob,
arguin
gth
atw
omen
were
‘‘more
mild
and
gentle,’’
‘‘ofpu
rerm
orals,’’w
ith‘‘stron
gerparen
talim
pulses.’’ 39
Secon
darysch
oolteach
ing
and
schooladm
inistration
remain
edjobs
form
en.
The
model
alsoin
dicatesw
hy
gender-job
associations
may
persist.If
associations
aresectorw
ideor
econom
ywide,
and
not
firm
-specific,perfectly
competitive
firm
sw
illunderin
vestin
new
jobcategories.
Ben
efits
wou
ldaccru
eto
other
firm
s.In
the
absence
ofmarket
power
ortech
nologicalch
ange,a
shift
insocial
attitudes
and
legalinterven
tionw
ould
benecessary
forch
anges
inem
ploymen
tpattern
s.T
he
modeleasily
extends
toth
edecision
toparticipate
inth
elabor
force.If
wom
en’s
identity
isen
han
cedby
work
inside
the
hom
e,th
eyw
illhave
lower
laborforce
attachm
ent
than
men
.H
istorically,fem
alelabor
forceparticipation
rates,relative
tom
alerates,h
avebeen
bothlow
eran
dm
orecyclically
variable.
B.Im
plications
forL
aborM
arketOu
tcomes
This
identity
model
explains
employm
ent
patterns
arising
fromassociation
sbetw
eengen
deran
dtype
ofw
ork.T
hese
pat-
35.B
lauan
dF
erber[1986,
Chapter
7]also
discuss
the
‘‘psychic
costs’’in
curred
bya
wom
an(m
an)
workin
gin
ajob
requirin
g‘‘m
asculin
e’’(‘‘femin
ine’’)
traits.36.G
oldin[1990b]
considers
am
odelw
here
men
lose‘‘statu
s’’when
wom
enw
orkon
their
jobsbecau
seth
ejobs
arerevealed
tobe
lessdifficu
ltor
physically
deman
ding.
37.W
ehave
alreadyseen
such
emotion
san
dbeh
aviorin
Pierce’s
[1995]law
firm
and
Padavic’s
[1991]power
plant.S
chultz
[1998]relatesa
plethora
ofsimilar
cases.38.A
firm
with
market
power
will
earna
furth
erbon
us
fromoccu
pational
segregationin
the
formofw
agediscrim
ination
.39.
See
quotation
ofMan
nin
Sugg
[1978,p.74],and
other
An
nu
alReports
byM
ann.
EC
ON
OM
ICS
AN
DID
EN
TIT
Y733
terns
gobeyon
dw
hat
canbe
explained
byw
omen
’sassu
med
lower
laborforce
attachm
ent
asin
Min
ceran
dP
olachek
[1974],where
wom
enw
orkin
occupation
sth
atrequ
irelittle
investm
ent
infirm
-specific
hum
ancapital. 40
Inou
rm
odel,wom
enw
illdomin
atejobs
whose
requirem
ents
match
constru
edfem
aleattribu
tesan
din
feriorsocialstatu
s;men
eschew
them
.Historically,th
reeoccu
pations
illustrate:secretar-
ies(97.8
percent
female
in1970
41)have
oftenbeen
called‘‘office
wives,’’an
delem
ents
ofsexu
alityare
inscribed
inth
ew
orking
relationsh
ip(boss
�m
ale,secretary�
female)[M
acKin
non
1979;P
ringle
1988].Secretaries
areexpected
toserve
their
bosses,with
deference,
and
tobe
attentive
toth
eirperson
alneeds
[Davies
1982;K
anter
1977;P
ierce1996].
Elem
entary
school
teachers
(83.9percen
tfem
ale),in
contrast
tosecon
darysch
oolteach
ers(49.6
percent
female),
aresu
pposedto
carefor
young
children
.N
urses
(97.3percen
tfem
ale)are
supposed
tobe
tender
and
carefor
patients,
asw
ellas
bedeferen
tialto
doctors[F
isher
1995;W
illiams
1989].In
our
model,w
omen
donot
enter
male
professions
because
ofgen
derassociation
s.H
istorically,m
any
male
professions
have
required
similar
levelsof
education
and
trainin
gto
female
professions
and
could
have
beenam
enable
topart-tim
ean
din
termitten
tw
ork.C
ontrast
nursin
gan
dteach
ing
with
account-
ing
and
law.
All
require
collegedegrees
and
certification
,an
dsom
etimes
have
tenure
and
experience-based
pay.Only
the
verytop
ofth
eseprofession
shave
required
contin
uity
inem
ploymen
tan
dfu
ll-time
work.
Rhetoric
surrou
ndin
gjob
shifts
fromm
aleto
female
furth
erdem
onstrates
the
salience
ofgender-job
associations.T
he
recruit-
men
tofwom
enin
to‘‘m
en’s
jobs’’durin
gW
orldW
arII,for
example,
was
accompan
iedby
officialpropagan
daan
dpopu
larliteratu
repictu
ring
wom
entakin
gon
factoryw
orkw
ithou
tlossoffem
inin
ity[M
ilkman
1987;Hon
ey1984;P
ierson1986].In
addition,th
ejobs
40.T
he
empirical
evidence
forth
ishum
ancapital
explanation
ism
ixed(see
Blau
,Sim
pson,
and
Anderson
[1998]for
review).
Oth
erth
eoriesbased
onlow
workplace
attachm
ent
ofw
omen
inclu
deL
azearan
dR
osen[1990],w
here
occupa-
tional
segregationis
aform
ofstatistical
discrimin
ation;
workers
inth
em
aleoccu
pations,i.e.,w
ithhigh
laborforce
attachm
ent,are
targetsfor
promotion
,and
those
inth
efem
aleoccu
pations
arenot.In
Bulow
and
Sum
mers
[1986],primary-
sectorfirm
sm
ust
payw
omen
high
erw
ageprem
ium
sto
prevent
them
fromsh
irking
because
wom
enare
more
likelyto
quit
their
jobs.These
firm
s,therefore,
preferhirin
gm
ento
wom
en.
41.See
Blau
,Sim
pson,
and
Anderson
[1998,A
ppendix
A-1]
forth
esean
dfollow
ing
figu
res.Allfi
gures
here
arefor
1970.
QU
AR
TE
RL
YJ
OU
RN
AL
OF
EC
ON
OM
ICS
734
were
portrayedas
temporary;
only
the
wartim
eem
ergency
ex-cu
sedth
eviolation
ofthe
usu
algender
prescriptions.
C.E
ffectsofth
eW
omen
’sM
ovemen
t
The
model
givesa
theoretical
structu
refor
how
the
wom
en’s
movem
entm
ayhave
impacted
the
laborm
arket.The
movem
ent’s
goalsin
cluded
reshapin
gsocietal
notion
sof
femin
inity
(and
mascu
linity)
and
removin
ggen
derassociation
sfrom
tasks,both
inth
ehom
ean
din
the
workplace.
Inth
em
odel,su
chch
anges
wou
lddecrease
wom
en’s
gains
(men
’slosses)
iniden
tityfrom
hom
emakin
g,an
ddecrease
the
identity
lossI
sof
wom
en(m
en)
workin
gin
traditionally
men
’s(w
omen
’s)jobs,
asw
ellas
the
accompan
ying
externalities
Io .T
hese
shifts
wou
ldin
creasew
om-
en’s
laborforce
participationan
dlead
toa
convergen
ceof
male
and
female
jobten
ure
rates.M
orew
omen
(men
)w
ould
work
inpreviou
slym
ale(fem
ale)jobs.A
llthese
outcom
esare
observedcoin
cidentalw
ithan
dfollow
-in
gth
ew
omen
’sm
ovemen
t. 42Gen
der-jobassociation
sdim
inish
ed,refl
ectedin
chan
gesin
langu
age(e.g.,
firem
enbecam
efirefi
ght-
ers).In
1998th
em
edianjob
tenure
ofem
ployedw
omen
over25
was
0.4years
lower
than
that
ofm
en;in
1968th
atgap
had
been3.3
years. 43C
han
gesin
sexcom
positionw
ithin
occupation
sac-
counted
forth
em
ajorsh
areofdeclin
ein
occupation
alsegregationfrom
1970–1990[B
lau,S
impson
,and
Anderson
,1998].Ofth
e45
three-digit
Cen
sus
occupation
sth
atw
ere0.0
percent
female
in1970,
only
one
(supervisors:
brickmason
s,ston
emason
s,an
dtile
setters)was
lessth
an1
percentfem
aletw
enty
yearslater. 44M
any
incu
rsions
offem
alesin
tom
ale-domin
atedprofession
sw
erevery
large.Con
sideragain
accountin
gan
dlaw
.In1970
(1990)females
were
24.6(52.7)
percent
ofau
ditorsan
daccou
ntan
ts,an
d4.5
(24.5)percentoflaw
yers.Not
only
didth
eproportion
ofwom
enin
men
’sjobs
increase,bu
tso
didth
eproportion
ofm
enin
wom
en’s
jobs(albeit
much
lessdram
atically). 45O
fth
etriu
mvirate
of
42.T
he
Fem
inin
eM
ystique
was
publish
edin
1963,and
the
Nation
alOrgan
i-zation
forW
omen
was
founded
in1966.
43.3.8
yearsfor
men
versus
3.4for
wom
enin
1998[U
nited
States
Depart-
men
tof
Labor,
1998];7.1
yearsfor
men
versus
3.8for
wom
enin
1968.[S
ource:
calculation
fromTable
A,U
.S.D
epartmen
tof
Labor,S
pecialL
aborF
orceR
eport112,J
obTen
ure
ofW
orkers,Jan
uary
1968.]T
he
figu
resfor
the
two
yearsare
not
strictlycom
parable;in
1968th
equ
estionasked
forth
etim
eelapsed
since
the
beginnin
gof
the
curren
tjob,in
1998sin
ceth
ecu
rrent
employer.M
edianm
alejob
tenure
has
alsobeen
considerably
affectedby
shifts
inth
eage
distribution
ofth
ew
orkforce,bothbecau
seofdem
ographic
shifts
and
alsoearly
retiremen
t.44.
Sou
rce:Blau
,Sim
pson,an
dA
nderson
[1998,Appen
dixA
-1].45.
See
Blau
,Sim
pson,an
dA
nderson
[1998,Table3
and
Appen
dixA
-1].
EC
ON
OM
ICS
AN
DID
EN
TIT
Y735
explanation
sfor
such
increases—
technology,
endow
men
ts,an
dtastes—
elimin
ationm
akestastes
the
leading
suspect,sin
ceth
erew
asno
dramatic
chan
gein
technology
oren
dowm
ents
that
wou
ldhave
caused
such
increased
mixin
gon
the
job. 46L
egalin
itiativesdiscu
ssednext
reflect
such
chan
gesin
tastes.
D.G
end
er-Job
Association
san
dS
exD
iscrimin
ationL
aw
Legal
interpretation
sof
sexdiscrim
ination
correspond
toearlier
econom
icm
odelsas
well
asou
row
n.T
itleV
IIof
the
Civil
Righ
tsA
ctof1964
makes
itunlaw
fulfor
anem
ployerto
discrimi-
nate
‘‘against
any
individu
al...with
respectto
...compen
sation,
terms,
condition
s...
ofem
ploymen
t’’or
‘‘to[adversely]
limit,
segregate,orclassify
his
employees
...because
of...sex.’’ 47Atits
most
basic,this
lawproh
ibitsa
discrimin
atoryexercise
of‘‘tastes’’again
stw
omen
(analogou
sto
Becker
[1971]an
dA
rrow[1972]).
Cou
rtsalso
interpretT
itleV
IIas
outlaw
ing
statisticaldiscrimin
a-tion
bysex
orcriteria
correlatedw
ithsex,
evenw
hen
wom
enon
averagelack
adesirable
jobqu
alification
.D
iscrimin
atoryhirin
gbecau
seof
wom
en’s
presum
edlow
erw
orkplaceattach
men
t,asin
Lazear
and
Rosen
[1990],w
asprecisely
the
issue
addressedin
Ph
illipsv.M
artin-M
arietta. 48O
ur
model,
where
sexdiscrim
ination
occurs
because
jobshave
gender
associations,correspon
dsto
aw
iderin
terpretationof
Title
VII.
This
interpretation
isat
the
forefront
ofcu
rrent
legaldebate
and
issu
pportedby
anum
berofpreceden
ts.InD
iazv.P
anA
merican
World
Airw
ays, 49the
Cou
rtoutlaw
edsex
bans
inhirin
g.T
he
airline
originally
pleadedfor
their
prohibition
ofm
alefligh
tatten
dants
because
wom
enw
erebetter
at‘‘th
enon
mech
anical
aspectsofth
ejob.’’B
utth
isassociation
ofgender
with
the
jobw
asdisallow
edon
appealsince
femin
ine
traitsw
eredeem
edirrelevan
tto
the
‘‘primary
function
orservices
offered’’(citedin
MacK
innon
[1979,p.180]).Price
Waterh
ouse
v.Hopkin
s50
seta
precedent
forw
orkersalready
hired.
The
plaintiff
had
beenden
ieda
partner-
ship
afternegative
evaluation
sfor
her
mascu
line
deportmen
t.T
he
Suprem
eC
ourt
ruled
that
‘‘anem
ployerw
ho
objectsto
46.C
ompu
tersare
used
inten
sivelyin
fewof
the
occupation
sw
ithm
ajorch
anges
inm
ix.47.
42U
.S.C
.§§2000e–2000e17
[1982],Section
s703(a)(1)an
d703(a)(2).
48.442
F.2d385
(5thC
ir.1971),cert.den
ied,404
U.S
.950(1971).G
riggsv.
Du
keP
ower,
401U
.S.
424(1971),
arace
discrimin
ationcase,
isan
importan
tpreceden
tou
tlawin
gtest
results
and
other
criteriacorrelated
with
raceor
gender
asem
ploymen
tscreen
s.49.
442F.2d
385(5th
Cir.)cert.d
enied
,404U
.S.950
(1971).50.
490U
.S.228
(1989).
QU
AR
TE
RL
YJ
OU
RN
AL
OF
EC
ON
OM
ICS
736
aggressiveness
inw
omen
but
whose
positions
require
this
traitplaces
wom
enin
anin
tolerablean
dim
permissible
Catch
22’’(cited
inW
urzbu
rgan
dK
lonoff
[1997,p.
182]).C
aseshave
alsoin
volvedharassm
ent
ofw
omen
workin
gin
men
’sjobs
as,in
the
termin
ologyof
our
model,
male
coworkers
protectth
emselves
fromloss
ofidentity
Io .B
erkman
v.City
ofNew
York51rein
stateda
firefi
ghter
who
had
beendism
issedbecau
seof
substan
dardw
orkperform
ance.
The
Cou
rtru
ledth
atth
ein
terference
and
harass-
men
tby
her
male
coworkers
made
itim
possiblefor
her
toperform
her
jobadequ
ately[S
chultz
1998,p.1770].This
expansive
inter-
pretationof
a‘‘h
ostilew
orken
vironm
ent,’’a
categoryof
sexual
harassm
entw
hich
isin
turn
acategory
ofsexdiscrim
ination
,has
beenexception
al.Judges
have
viewed
sexual
desireas
anessen
-tial
elemen
tof
sexual
harassm
ent.
How
ever,Sch
ultz
[1998]an
dF
ranke
[1995]argu
eth
atan
yharassm
ent
derivedfrom
gender
prescriptions
has
discrimin
atoryim
plications
(asdepicted
inou
rm
odel)and
areth
us
violations
ofTitle
VII.
V.ID
EN
TIT
YA
ND
TH
EE
CO
NO
MIC
SO
FE
XC
LU
SIO
NA
ND
PO
VE
RT
Y
This
sectionw
illcon
sideriden
tityan
dbeh
aviorin
pooran
dsocially
excluded
comm
unities.
Inan
adaptationof
the
previous
model
ofG
reens
and
Reds,
peoplebelon
ging
topoor,
sociallyexclu
dedgrou
psw
illch
ooseth
eiriden
tity.G
reens
identify
with
the
domin
ant
cultu
re,while
those
with
Red
identity
rejectit
and
the
subordin
ateposition
assigned
toth
oseofth
eir‘‘race,’’class,or
ethnicity. 52
From
the
point
ofview
ofth
osew
ithG
reeniden
tities,R
edsare
oftenm
aking
badecon
omic
decisions;th
eym
ighteven
bedescribed
asen
gaging
inself-destru
ctivebeh
avior.Taking
drugs,
joinin
ga
gang,an
dbecom
ing
pregnan
tatayou
ng
ageare
possiblesign
sof
aR
ediden
tity.T
his
aspectof
behavior
has
not
beenexplored
inpreviou
sm
odels,but
itis
implicit
inW
ilson’s
account
ofblack
ghetto
poverty[1987,
1996].It
alsois
implicit
inevery
51.580
F.Supp.
226(E
.D.N
.Y.1983),
aff’d,
755F.
2d913
(2dC
ir.1985).
Berkm
anfollow
edth
eexpan
siveview
inM
cKin
ney
v.D
ole,765
F.2d
1129(D
.C.
Cir.1985),th
at‘‘an
yharassm
entor
unequ
altreatmen
tofan
employee
orgrou
pof
employees
thatw
ould
notoccu
rbu
tforth
esex
ofthe
employee
orem
ployeesm
ay,ifsufficien
tlypattern
edor
pervasive,com
prisean
illegalcon
ditionof
employm
ent
under
Title
VII’’(cited
inSch
ultz
[1998,p.1733]).52.
Much
literature
oniden
tityan
dsocial
exclusion
argues
that
domin
ant
groups
define
them
selvesvis-a-vis
‘‘other(s),’’
and
mem
bersof
the
domin
ant
(excluded)
groups
benefi
t(lose)—
materially
and
psychologically—
fromth
ediffer-
entiation
.F
ordiscu
ssionof
different
approaches
toth
estu
dyof
socialdifferen
cean
dracism
,seeW
etherell[1996].
EC
ON
OM
ICS
AN
DID
EN
TIT
Y737
study
that
finds
signifi
cant
dum
my
variablesfor
‘‘race,’’after
adjustm
ent
foroth
erm
easures
ofsocioecon
omic
status.
The
Green
/Red
model
ofth
issection
offersan
explanation
forth
esign
ifican
ceof
such
dum
my
variables.F
urth
ermore,
ityields
aless
mon
olithic
viewof
povertyth
ancu
rrent
econom
icth
eoriesth
atem
phasize
conform
ity(e.g.,
Akerlof
[1997]an
dB
rockan
dD
urlau
f[1995]).
A.M
otivationfor
Mod
el
Our
modelrefl
ectsth
em
any
ethnograph
icaccou
nts
of‘‘oppo-sition
al’’identities
inpoor
neigh
borhoods.M
acLeod’s
[1987]study
ofteen
agersin
aB
ostonarea
hou
sing
project,for
example,
contrasts
the
murderou
san
dalcoh
olicH
allway
Han
gersto
their
obedient
and
athletic
peers,the
Broth
ers.InL
earnin
gto
Labou
rW
illis[1977]describes
the
antagon
ismbetw
eenth
eunru
ly‘‘lads’’
and
the
dutifu
l‘‘earh
oles’’ina
workin
g-classE
nglish
secondary
school.
Sim
ilarly,W
hyte’s
[1943]description
ofB
oston’s
ItalianN
orthE
nd
circa1940
contrasts
the
Corn
erB
oysto
the
College
Boys.Yet
earlier,turn
-of-the
centu
ryaccou
nts
ofth
eIrish
inth
eU
nited
States
contrast
the
‘‘lacecu
rtain’’Irish
ofpoor
districtsto
their
neigh
bors(see,e.g.,M
iller[1985]).
Our
model
furth
erevokes
the
psychological
effectsof
socialexclu
sionin
the
colonial
experience
analyzed
byB
habh
a[1983]
and
Fan
on[1967],an
din
the
context
ofAfrican
-Am
ericans
inth
eU
nited
States
byA
nderson
[1990],Baldw
in[1962],C
lark[1965],
DuB
ois[1965],F
razier[1957],H
annerz
[1969],Rain
water
[1970],W
ilson[1987,
1996],an
doth
ers.In
these
settings,
individu
alsfrom
particular
groups
cannever
fully
fit
the
idealtype,the
ideal‘‘G
reen,’’of
the
domin
ant
cultu
re.Som
ein
excluded
groups
may
tryto
‘‘pass’’orin
tegratew
ithth
edom
inan
tgrou
p,butth
eydo
sow
itham
bivalence
and
limited
success. 53
Aseries
ofau
tobiogra-ph
iestells
ofth
epain
and
anger
ofdiscoverin
gth
aton
eis
not
really‘‘G
reen.’’F
ormer
New
YorkT
imes
editorM
elWatkin
s[1998]
titlesth
ech
apteron
his
freshm
anyear
atC
olgateas
‘‘stranger
ina
strange
land.’’G
andh
i[1966],
Fan
on[1967],
Fulw
ood[1996],
Staples
[1994],and
Rodrigu
ez[1982]
allrelate
strikingly
similar
experiences
ofperceived
orreal
rejectionan
dalien
ation.
This
socialexclu
sionm
aycreate
acon
flict:
how
tow
orkw
ithin
the
domin
antcu
lture
with
outbetrayin
gon
eself.As
JillNelson
[1993,
53.In
deed,th
ew
ordpassin
gitself
ispejorative
and
evokesa
penum
braof
reactions
tobein
goth
erth
anon
e’s‘‘tru
e’’self.
QU
AR
TE
RL
YJ
OU
RN
AL
OF
EC
ON
OM
ICS
738
p.10]explains
her
exhau
stionafter
alon
gday
ofinterview
ing
fora
jobat
Th
eW
ashin
gtonP
ost:
I’vealso
beendoin
gth
estan
dardN
egrobalan
cing
actw
hen
itcom
esto
dealing
with
white
folks,which
involves
sufficiently
blurrin
gth
eedges
ofmy
being
soth
atth
eydon
’tfeelin
timidated,w
hile
simultan
eously
holdin
gon
tom
yin
tegrity.There
isa
thin
line
between
Uncle-Tom
min
gan
dM
au-M
auin
g.To
falloff
that
line
canm
eandisaster.
On
one
sidelies
employm
ent
and
self-hatred;
onth
eoth
er,th
eequ
allydu
bious
hon
orof
unem
ploymen
tw
ithin
tegrity.
These
reactions,itm
ustbe
emph
asized,reflecth
owdom
inan
tgrou
psdefi
ne
them
selvesby
the
exclusion
ofothers.T
he
creationan
devolu
tionof
such
socialdifferen
cesare
the
subject
ofm
uch
historical
research.Said
[1978]docu
men
tsth
eem
ergence
ofth
eW
esternidea
ofth
e‘‘O
riental,’’
acon
ceptth
athad
signifi
cant
implication
sfor
colonialism
.Inth
eU
nited
States
Roediger
[1991]an
doth
erhistorian
ssh
owhow
workers
ofE
uropean
descent
inth
enin
eteenth
centu
ryin
creasingly
were
defined
as‘‘w
hite.’’P
riorto
Em
ancipation
,this
identity
evokedth
econ
trastbetw
eenw
hite
freedoman
dA
frican-A
merican
enslavem
ent.
Inth
em
odelw
econ
struct,
the
keyin
teractionis
between
such
socialdifferen
cesan
dth
eadoption
ofopposition
aliden
titiesby
those
inexclu
dedgrou
ps.L
ackof
econom
icopportu
nity
may
alsocon
tribute
toth
ech
oiceofan
oppositionaliden
tity.Wilson
[1987,1996]underscores
the
relationbetw
eenth
edeclin
ein
remunerative
unskilled
jobs,th
eloss
ofself-respect
bym
enw
ho
cannot
support
their
families,
and
the
risein
inner
citycrim
ean
ddru
gabu
se.T
his
processis
illustrated
inm
icrocosmby
‘‘Rich
ard’’inT
ally’sC
orner
[Liebow
1967].U
nable
tofind
decent-payin
gw
ork,he
abandon
edhis
family
and
joined
Tally’sgrou
pof
idlerson
the
streetcorn
er.B
yadoptin
ga
different
identity,R
ichard
no
longer
sufferedth
egu
iltofa
failedprovider. 54
Red
activitieshave
negative
pecuniary
externalities.
Rich
-ard’s
wife
and
children
had
tofind
alternative
mean
sof
support.
The
prime
goalofthe
‘‘lads’’inW
illis’secondary
schoolw
asto
geta‘‘laff,’’th
rough
vandalism
,picking
figh
ts,and
return
ing
drunk
tosch
oolfrom
the
localpu
b.Runnin
ga
school
with
ladsis
difficult.
The
situation
corresponds
toth
eextern
alitiesin
Ben
abou’s
[1993,1996]
models
ofhigh
schoolin
gcosts
inpoor
neigh
borhoods.
54.See
Mon
tgomery
[1994]for
anin
terpretationof
Rich
ard’sbeh
aviorin
terms
ofcognitive
dissonan
ce.
EC
ON
OM
ICS
AN
DID
EN
TIT
Y739
Furth
erextern
alitiesaccru
efrom
drug
dealing,crim
e,and
other
‘‘pathological’’beh
avior.In
our
model,
there
arealso
identity-based
externalities.
AR
edis
angered
bya
Green
’scom
plicityw
ithth
edom
inan
tcu
lture,
while
aG
reenis
angered
bya
Red’s
‘‘breaking
the
rules.’’A
gaincon
siderW
illis’ladsan
dearh
oles.As
the
ladsdefi
ne
them
selvesin
contrast
toth
eearh
oles,th
eearh
olesdefi
ne
them
selvesin
con-
trastto
the
lads.T
he
earholes
areeven
more
proestablishm
ent
than
the
teachers—
feeling
that
the
teachers
shou
ldbe
stricter.T
he
lads,in
turn
,bait
the
earholes.
This
situation
isju
ston
e(relatively
tame)
example
ofhow
interaction
between
the
two
groups
generates
antagon
ismon
bothsides.
B.Id
entity
Mod
elofPoverty
and
SocialE
xclusion
As
inth
eprototype
model,th
ereare
two
activities,One
and
Two.A
ctivityO
ne
canbe
thou
ghtofas
‘‘workin
g’’and
Activity
Two
as‘‘n
otw
orking.’’T
here
isa
largecom
munity,n
ormalized
tosize
one,
ofin
dividuals.
The
econom
icretu
rnto
Activity
One
forin
dividual
iis
vi
which
we
assum
eis
uniform
lydistribu
tedbetw
eenzero
and
one,
torefl
ectheterogen
eityin
the
population
and
toen
sure
interior
solution
s.The
econom
icretu
rnto
Activity
Two
isnorm
alizedto
zero.A
sfor
identity,
there
aretw
osocial
categories,G
reenan
dR
ed.AG
reensuffers
aloss
iniden
tityr,represen
ting
the
extentto
which
someon
efrom
this
comm
unity
isnot
acceptedby
the
domin
ant
group
insociety.
Those
with
the
lessadaptive
Red
identity
donot
sufferth
isloss.B
ehavioral
prescriptions
sayth
atG
reens
(Reds)sh
ould
engage
inA
ctivityO
ne
(Two).T
hus,a
Green
(Red)
losesiden
tityfrom
Activity
Two
(One)
inam
ount
Is G(I
s R). 55B
ecause
Reds
rejectth
edom
inan
tG
reencu
lture,
they
arealso
likelyto
have
lower
econom
icretu
rns
toA
ctivityO
ne
than
Green
s. 56A
Red
individu
ali
will
only
earnv
i�
afrom
Activity
One,
asw
ellas
sufferth
eloss
Is R.
There
arealso
identity
externalities
when
Green
san
dR
edsm
eet.AG
reen(R
ed)suffersa
lossI
o G(Io R).
Inaddition
,R
edsw
ho
have
chosen
Activity
Two
55.W
ediscu
ssbelow
the
possibilityof
aR
ediden
tityw
here
individu
alscan
bothreject
the
domin
antcu
lture
and
atth
esam
etim
edo
not
loseI
s Rfrom
Activity
One.56.
Wilson
[1996,C
hapter
5]docu
men
tsth
edifficu
ltiesth
atem
ployersperceive
inhirin
gem
ployeesfrom
the
inner
city.F
romth
evan
tagepoin
tof
our
model,
itdoes
not
matter
wheth
erth
eperceived
problems,
parameterized
bya,
reflectrealdifferen
cesin
productivity
orth
oseth
atarem
erelyim
agined
because
ofth
em
ismatch
ofthe
employers’an
dth
eem
ployees’attitudes.
QU
AR
TE
RL
YJ
OU
RN
AL
OF
EC
ON
OM
ICS
740
impose
apecu
niary
externality
kon
those
who
have
chosen
Activity
One.
Each
personi
chooses
aniden
tityan
dactivity,
giventh
ech
oicesofeveryon
eelse
inth
ecom
munity.W
eassu
me
that
peoplecan
not
modify
their
identity
oractivity
foreach
individu
alen
counter.
Rath
er,in
dividuals
choose
aniden
tityan
dactivity
tom
aximize
expectedpayoffs,given
the
probabilitiesof
encou
nters
with
Green
sw
ho
choose
Activity
One,
Green
sw
ho
choose
Two,
Reds
who
choose
One,an
dR
edsw
ho
choose
Two.
C.E
quilibria
and
Interpretation
Equ
ilibriaof
this
model
show
how
socialin
teractionw
ithin
the
comm
unity
and
socialexclu
sionfrom
the
domin
ant
group
determin
eth
eprevalen
ceof
Red
identities
and
Activity
Two
behavior. 57
An
All-G
reenE
quilibriu
m(everyon
eis
Green
and
engages
inA
ctivityO
ne)
exists,if
and
only
ifth
eloss
inG
reeniden
tity,r,
fromexclu
sionfrom
the
domin
ant
group
issm
allerth
anth
edifficu
ltyof
being
Red
ina
comm
unity
ofG
reens,
Io R.
Figu
reII
show
sth
iscon
ditionin
the
areaabove
the
45°lin
efrom
the
origin.F
orhigh
erlevels
ofr,equ
ilibriam
ust
involve
some
inth
ecom
munity
adopting
aR
ediden
tity.T
he
non
existence
ofth
eA
ll-Green
equilibriu
mreveals
adifferen
cein
the
predictions
ofth
ism
odelan
dpreviou
sm
odelsof
behavior
inpoor
neigh
bor-hoods.H
ere,socialexclu
sion(r
�0)
will
leadsom
epeople
inth
ecom
munity
toadopt
anopposition
aliden
tityan
dA
ctivityTw
obeh
avior,evenin
the
absence
ofcon
formity-gen
erating
externali-
ties(i.e.,I
o R�
Io G
�k
�0).
Ina
Mixed
Equ
ilibrium
ofour
model,som
ein
the
comm
unity
choose
Activity
One
and
aG
reeniden
tity,bu
toth
ersch
ooseA
ctivityTw
oan
dR
ediden
tities.T
his
equilibriu
marises
forin
termediate
levelsof
r(in
the
areabetw
eenth
etw
oupw
ard-slopin
glin
esin
Figu
reII).
The
equilibriu
madoption
ofR
ediden
titiesan
dA
ctivityTw
obeh
aviorcaptu
resth
eself-destru
ctivebeh
aviorof
the
underclass
central
tosociological
study,
but
contrary
tostan
dardecon
omic
thin
king.R
ainw
ater[1970,p.3]
sum
marized
his
classicstu
dyof
ghetto
poverty:‘‘w
hite
cupidity
createsstru
ctural
condition
shigh
lyin
imicalto
basicsocialadaptation
tow
hich
Negroes
adapt
57.F
ullan
alysisof
the
modelis
availablefrom
the
auth
orsupon
request.In
the
analysis
we
make
the
simplifyin
gassu
mption
that
Is G
�k
soth
atan
y-on
ew
ho
chooses
aG
reeniden
tityw
illch
ooseA
ctivityO
ne.
We
alsoassu
me
thatallparam
etersare
strictlypositive
andless
thanunity
andthatI
s R�
a�
k�
1.
EC
ON
OM
ICS
AN
DID
EN
TIT
Y741
bysocial
and
personal
responses
which
serveto
sustain
the
individu
alinhis
punish
ing
world
butalso
togen
erateaggressive-
ness
toward
the
selfand
others
which
results
insufferin
gdirectly
inflicted
byN
egroeson
them
selvesan
don
others.’’W
hile
Activity
One
ism
aximizin
gto
someon
ew
itha
Green
identity,
itis
not
maxim
izing
tosom
eone
with
aR
ediden
tity.The
‘‘self-destructive’’
Red
behavior
isnot
the
result
ofin
dividual
‘‘irrationality,’’bu
tin
steadderives
fromlow
econom
icen
dowm
ents
and
ahigh
degreeofsocialexclu
sion.
Com
parativestatics
ofth
em
ixedequ
ilibrium
captures
Wil-
son’s
[1987,1996]an
alysisof
ghetto
poverty.An
out-m
igrationof
the
middle
class(th
osew
ithhigh
return
sv
iin
the
model)
will
result
infu
rther
adoptionof
Red
identities
amon
gth
erem
ainin
gpopu
lation.A
lso,when
work
disappears,there
willbe
adow
nw
ard
FIG
UR
EII
Equ
ilibriain
ModelofP
overtyan
dSocialE
xclusion
This
figu
resh
ows
ranges
ofparam
etervalu
esfor
three
different
equilibria:
All-G
reenw
here
everyone
isG
reenan
dch
oosesA
ctivityO
ne;
Mixed
where
Green
sch
ooseA
ctivityO
ne
and
Reds
choose
Activity
Two;
All-R
edw
here
everyone
isR
edan
dsom
ech
ooseA
ctivityO
ne
and
others
choose
Activity
Two.
QU
AR
TE
RL
YJ
OU
RN
AL
OF
EC
ON
OM
ICS
742
shift
indistribu
tionof
payoffsfrom
Activity
One.
This
shift
will
alsoin
creaseth
ein
cidence
ofActivity
Two
and
Red
identities.
Inan
All-R
edE
quilibriu
m,som
ein
dividuals
choose
Activity
One
and
conform
with
the
domin
ant
group
interm
sof
econom
icbeh
avior,butallch
oosean
oppositionalR
ediden
tity.This
equilib-
rium
arisesw
hen
ahigh
lossfrom
being
Green
inan
all-Red
comm
unity,I
o G,complem
ents
high
levelsof
socialexclu
sion,r
(inth
earea
toth
erigh
tof
the
verticallin
ein
Figu
reII). 58
This
equilibriu
mis
alsoach
ievedw
itha
lowvalu
eof
Is R
and,
thus,
providesan
interpretation
ofsocial
movem
ents
that
may
arisefrom
exclusion
.Som
eseparatist
leaders,such
asM
alcolmX
and
Lou
isF
arrakhan
,have
advanced
anopposition
alRed
identity
but
atth
esam
etim
ehave
triedto
chan
geassociated
prescriptions,
resultin
gin
alow
erI
s R.Inth
esem
ovemen
ts,Activity
One
doesnot
imply
complicity
with
the
domin
ant
group.R
ather,self-restrain
t,edu
cation,an
dem
ploymen
tare
am
eans
forin
dividual
advance-
men
tan
dcom
munity
liberation.
D.F
urth
erL
essons
fromth
eM
odel
The
model
and
itssolu
tionalso
affordin
terpretations
ofpolicies
designed
toredu
cepoverty
and
the
effectsof
socialexclu
sion.
First,
the
model
indicates
why
residential
JobC
orpspro-
grams
may
succeed
while
other
trainin
gprogram
sfail
[Stan
ley,K
atz,and
Kru
eger1998].A
ccording
toth
em
odel,taking
trainees
outofth
eirneigh
borhoods
wou
ldelim
inate,atleastfor
atim
e,the
negative
effectsof
interaction
with
those
with
Red
identities.
Moreover,
being
ina
different
locationm
ayredu
cea
trainee’s
directloss
rfrom
being
Green
and
pursu
ing
Activity
One.T
hat
is,th
isloss
may
beboth
individu
al-specific
and
situation
al,an
dleavin
ga
poorneigh
borhood
islikely
togen
eratea
lower
rth
anoth
erwise.In
asom
ewhatcon
trolledexperim
ent,th
eU
.S.govern
-m
enttried
tosave
mon
eyw
ithJO
BSTA
RT,w
hich
preservedm
any
ofth
efeatu
resof
JobC
orpsexcept
the
expensive
hou
sing
oftrain
ees.F
ollow-u
pstu
diesof
JOB
STA
RT
show
littleor
no
improvem
entin
employm
entor
earnin
gs. 59
58.It
overlapsth
eregion
sof
other
equilibria
because
this
condition
isin
dependen
tof
Io R,u
nlike
those
forth
eabove
equilibria
where
aR
edw
ould
sufferth
eloss
fromin
teracting
with
Green
s.59.
The
Cen
terfor
Em
ploymen
tan
dTrain
ing
inSan
Josew
asth
eon
erem
arkableexception
.
EC
ON
OM
ICS
AN
DID
EN
TIT
Y743
Secon
d,th
em
odelaffords
anin
terpretationof
different
education
initiatives
form
inority
studen
ts.L
ikeJob
Corps,
the
Cen
tralP
arkE
astSecon
darySch
ool(C
PE
SS)
inE
astH
arlemm
aysu
cceedbecau
seit
separatesG
reenstu
dents
fromR
edstu
dents.S
tuden
ts,forexam
ple,mustapply
toth
esch
ool,indicat-
ing
their
and
their
parents’
willin
gness
toadopt
itsru
les(see
Fliegel
[1993]an
dM
eier[1995]
forth
isan
doth
erdetails).
Anoth
erin
terpretationofC
PE
SS
and
other
successes
(e.g.,Com
er[1980]in
New
Haven
)parallelsth
elogic
ofthe
all-Red
equilibriu
mw
here
some
peoplenon
etheless
pursu
eA
ctivityO
ne.T
he
schools
takem
easures
toredu
ceth
eloss
iniden
tityofR
edstu
dents,I
s R,inactivities
such
aslearn
ing
Stan
dardE
nglish
. 60D
elpit’s[1995]
award-w
innin
gbook
Oth
erP
eople’sC
hild
renproposes
num
erous
ways
toredu
ceth
ealien
ationth
atm
inority
studen
tsm
ayexperi-
ence
insch
ool.F
inally,
the
model
illum
inates
aset
ofissu
esin
the
affirma-
tiveaction
debate.M
uch
ofth
isdebate
concern
sth
esu
ccessor
failure
ofspecifi
cprogram
s(see,
e.g.,D
ickens
and
Kan
e[1996]).
Yet,m
oreis
atstake.
The
rhetoric
and
symbolism
ofaffirm
ativeaction
may
affectth
elevelof
socialexclusion
r.On
the
one
han
d,L
oury
[1995]argu
esth
atportrayin
gA
frican-A
merican
sas
vic-tim
s,aportrayaln
ecessaryto
retainaffirm
ativeaction
programs,
iscostly
toblacks.
Interm
sof
the
model,
such
rhetoric
will
increase
ran
dth
eadoption
ofR
ediden
tities.On
the
other
han
d,affirm
ativeaction
will
decreaser,
toth
eexten
tit
isseen
asan
apologyfor
previous
discrimin
ationan
dan
invitation
forblack
admission
toth
edom
inan
tcu
lture.R
eversalofaffirmative
actionw
ould
negate
this
effect.To
citea
recent
example,
our
analysis
suggests
that
removin
gaffirm
ativeaction
admission
scriteria
atth
eU
niversity
ofC
alifornia
and
University
ofTexas
Law
Sch
oolscou
ldhave
behavioral
implication
sth
atfar
exceedth
eim
pacton
applicants.
The
identity
model
ofexclu
sion,
then
,explain
sw
hy
legalequ
alitym
aynot
been
ough
toelim
inate
racialdisparities. 61
If
60.O
gbu[1997]
and
Delpit
[1995]find
that
African
-Am
ericanstu
dents
inpoor
neigh
borhoods
may
beam
bivalent
about
learnin
gStan
dardE
nglish
,w
hose
use
may
becon
strued
as‘‘actin
gw
hite.’’
61.W
esee
this
distinction
inth
edifferen
tcon
clusion
softw
orecen
tstu
diesof
U.S
.racerelation
s.Thern
stroman
dT
hern
strom[1997]u
rgean
end
toaffirm
ativeaction
,makin
gth
ecase
that
attitudes
ofwhites
toward
blacksas
wellas
the
legalopportu
nities
forblacks
have
chan
gedsin
ceT
he
Am
ericanD
ilemm
a[M
yrdal1944].
Incon
trast,Shipler
[1997]poin
tsou
tth
em
any
ways
inw
hich
African
-A
merican
san
dw
hites
feeluncom
fortablew
itheach
other
and
how
blacksare
stillseen
asdifferen
tan
dnot
fully
accepted.
QU
AR
TE
RL
YJ
OU
RN
AL
OF
EC
ON
OM
ICS
744
African
-Am
ericans
choose
tobe
Red
because
ofexclu
sionan
dif
whites
perpetuate
such
exclusion
s,evenin
legalw
ays,there
canbe
aperm
anen
tequ
ilibrium
ofracial
inequ
ality.T
he
negative
externalities
and
their
consequ
ences,
how
ever,w
ould
disappearw
hen
the
comm
unity
isfu
llyin
tegratedin
toth
edom
inan
tcu
l-tu
re,soth
atr
�a
�0,an
deveryon
ein
the
comm
unity
adoptsa
Green
identity.
This,
ofcou
rse,is
the
Am
ericanideal
ofth
em
elting
pot,orth
enew
idealof
am
osaicw
here
difference
canbe
main
tained
with
inth
edom
inan
tcu
lture.
VI.
IDE
NT
ITY
AN
DT
HE
EC
ON
OM
ICS
OF
TH
EH
OU
SE
HO
LD
An
identity
model
ofth
ehou
sehold,u
nlike
previous
models,
predictsan
asymm
etricdivision
oflabor
between
husban
dsan
dw
ives.T
heories
basedon
comparative
advantage
(e.g.,B
ecker[1965]
and
Min
cer[1962])
predictth
atw
hoever
works
more
outside
the
hom
ew
illwork
lessin
sideth
ehom
e,wheth
erit
beth
ehusban
dor
the
wife.
Yet,th
edata
we
present
belowin
dicatea
gender
asymm
etry.W
hen
aw
ifew
orksm
orehou
rsou
tsideth
ehom
e,she
stillundertakes
alarger
share
ofthe
hou
sework.
Hoch
schild’s
[1990]stu
dyT
he
Secon
dS
hift
revealsth
ede-
tailsof
such
asymm
etries.One
ofth
ecou
plesin
her
study
found
anin
geniou
sw
ayto
share
the
hou
sework.
‘‘Evan
Holt,’’a
furn
i-tu
resalesm
an,took
careof
the
lower
half
ofth
ehou
se(i.e.,
the
basemen
tan
dhis
tools).H
isw
ife‘‘N
ancy,’’a
full-tim
elicen
sedsocial
worker,
tookcare
ofth
eupper
half.
She
tookcare
ofth
ech
ild.He
tookcare
ofthe
dog.Q
uan
titativeeviden
cefrom
Hoch
schild’s
sample
and
our
dataan
alysissu
ggestth
atth
eH
oltscon
formto
anation
alpattern
.F
igure
IIIsh
ows
the
lowaverage
ofhusban
ds’share
ofhou
sework
and
itslow
elasticityw
ithrespect
toth
eirsh
areof
outside
work
hou
rs.The
figu
replots
shares
ofhou
sework
reportedby
married
men
62inth
eP
anelS
tudy
ofIncom
eD
ynam
ics, 63ascom
puted
from
62.M
en’s
reportsof
hou
sework
shares
match
edalm
ostexactly
wom
en’s
reportsin
Preston
’s[1997]stu
dyof1700
scientists.
63.T
he
unit
ofobservation
isa
couple-year
forth
eyears
1983to
1992.C
ouples
were
inclu
dedin
agiven
year,ifth
eyw
erem
arried,neith
erm
ember
was
retired,neith
erm
ember
was
disabled,the
couple
had
positivew
orkhou
rs,positiveearn
ings,an
dpositive
hou
rsofh
ousew
ork.Inaddition
,they
were
only
inclu
dedif
there
were
complete
datafrom
bothm
embers
onearn
ings,w
orkhou
rs,hou
sework
hou
rs,an
dnum
berof
children
.T
he
final
sample
had
slightly
more
than
29,000cou
ple-yearsof
observations.W
edefi
ne
ahusban
d’ssh
areof
hou
sework,h
swk,as
his
share
ofth
etotal
performed
byth
ecou
ple.T
hus,
we
capture
the
divisionof
laboreven
inhou
seholds
that
hire
outside
workers.
We
estimate
the
followin
gTobit
equation
:hsw
k�
a�
�i�
1,2,3 [b1i h
i�
b2i h
i 2�
b3i h
i 3�
b4i h
i 4]�
error,where
hi
EC
ON
OM
ICS
AN
DID
EN
TIT
Y745
answ
ersto
the
question
(s):‘‘A
bout
how
much
time
doyou
(your
wife)spen
don
hou
sework
inan
averagew
eek?I
mean
time
spent
cooking,
cleanin
g,an
ddoin
goth
erw
orkarou
nd
the
hou
se?’’The
inten
tof
the
question
was
toexclu
dech
ildcare.T
he
figu
replots
men
’ssh
areof
hou
sework
asa
fourth
-orderpolyn
omial
ofth
eirsh
areof
outside
hou
rs,for
hou
seholds
byage
ofyou
ngest
child.
When
men
doall
the
outside
work,
they
contribu
teon
averageabou
t10
percentofh
ousew
ork.Butas
their
share
ofoutside
work
falls,their
share
ofhou
sework
risesto
no
more
than
37percen
t.As
show
nin
the
figu
reth
epresen
ceof
children
ofdifferen
tages
isth
ehusban
d’ssh
areof
outside
hou
rsw
orkedif
ingrou
pi.T
he
sum
mation
(i�
1,2,3)ru
ns
overth
reetypes
ofhou
sehold:w
ithno
children
oryou
ngest
child
overage
13,with
youngest
child
0to
5,and
with
youngest
child
6to
13.Con
trolsw
erein
cluded
forage
ofhusban
d,an
dw
iferelative
topopu
lationaverage,
logof
totalin
come,
and
alsototal
hou
rsof
hou
sework.
Resu
ltsw
ererobu
stto
different
specification
san
destim
ators,an
dsu
bstitution
ofsh
areof
earnin
gsfor
share
ofhou
rsw
orked.The
equation
san
dcon
fiden
cein
tervalsare
availableupon
request.
FIG
UR
EIII
Husban
ds’Share
ofHou
sework
Hou
rsversu
sT
heir
Share
ofOutside
Work
Hou
rs
QU
AR
TE
RL
YJ
OU
RN
AL
OF
EC
ON
OM
ICS
746
makes
asm
alldifference
toth
efu
nction
. 64Sim
ilarresu
ltsobtain
when
the
indepen
dent
variableis
shares
ofin
come
rather
than
shares
ofoutside
work
hou
rs.E
xisting
theories
donot
predictth
isasym
metry.C
onsider
the
followin
gvarian
tbased
oncom
parativeadvan
tage.Husban
dan
dw
ifeboth
have
the
same
utility
function
,w
hich
isin
creasing
inqu
antity
ofa
hou
sehold
public
goodth
atderives
fromth
eirjoin
tlabor. 65
Utility
isdecreasin
gin
own
laborin
puts
inou
tsidean
dhom
eprodu
ction. 66
We
assum
eequ
albargain
ing
power,
soth
ateach
marriage
partner
enjoys
the
same
levelofutility. 67
With
this
framew
ork,retu
rns
tospecialization
explainth
eobserved
divi-sion
oflabor
when
aw
ifehas
acom
parativeadvan
tagein
hom
eprodu
ction.W
omen
who
put
inless
than
half
ofth
eou
tsidew
orkhou
rspu
tin
more
than
half
the
hou
sework,
asseen
inth
erigh
t-han
dside
ofth
egraph
ofF
igure
III.B
ut
this
model
isin
consisten
tw
ithth
eleft-h
and
sideofth
egraph
.Iden
titycon
siderations
canexplain
the
high
shares
ofhou
se-w
orkofw
ivesw
ho
undertake
alarge
share
ofoutside
work
hou
rs.A
ddto
the
abovem
odeltwo
socialcategories,‘‘men
’’and
‘‘wom
en.’’
Prescription
sdictate
that
‘‘men
’’shou
ldnot
do‘‘w
omen
’sw
ork’’inth
ehom
ean
d‘‘m
en’’sh
ould
earnm
oreth
anth
eirw
ives.H
ochs-
child’s
interview
ssu
ggestth
atm
any
men
,and
some
wom
en,h
oldth
eseprescription
s.In
the
amen
dedm
odel,th
ehusban
dloses
identity
when
he
doeshou
sework
and
when
his
wife
earns
more
than
half
the
hou
sehold
incom
e.E
quality
ofutility
isrestored
when
the
wife
undertakes
more
hou
sework
than
her
husban
d.H
ochsch
ildreports
that
inth
e‘‘Tan
agawa’’
hou
sehold,
forex-
ample,‘‘N
ina’’earn
edm
oreth
anhalf
the
family
incom
e,but
she
64.H
erschan
dStratton
[1994]use
the
PSID
tostu
dyw
heth
erhusban
ds’high
erw
agein
comes
account
forth
eirlow
ersh
aresofh
ousew
ork.The
estimation
here,in
contrast,evalu
atesth
easym
metry
inth
erelation
ship
between
husban
ds’sh
areof
incom
ean
dth
eirsh
aresof
hou
sework,
and
wives’sh
aresof
incom
ean
dhou
sework.
65.T
he
public
goodsaspectofa
marriage
follows
Lundberg
and
Pollak
[1993],w
here
the
contribu
tions
ofeach
spouse
arein
‘‘separatesph
eres’’th
atrefl
ectgen
derroles.T
he
first
bargainin
gm
odelsofth
ehou
sehold
aredu
eto
Man
seran
dB
rown
[1980]and
McE
lroyan
dH
orney
[1981].66.
Utility
ofth
ew
ifeis
Uf
�U
f (g,hf h,h
f o),w
here
gis
the
hou
sehold
public
good,produ
cedby
bothhom
ean
dou
tsidelabor,
hf h
isth
ew
ife’shou
rsof
hou
se-w
ork,an
dh
f ois
her
outside
work.
The
husban
d’sutility
function
is,sim
ilarly,U
m�
Um
(g,hm h,h
m o),w
here
Uf an
dU
mare
assum
edto
beth
esam
efu
nction
s.67.
We
assum
eth
ata
hou
sehold
maxim
izesth
esu
mofu
tilitiessu
bjectto
the
condition
Uf�
Um
.When
bargainin
gpow
erderives
fromearn
ing
capabilitiesan
dcon
trolof
finan
cialresou
rces,as
assum
edby
Hersch
and
Stratton
[1994]an
doth
ers,itonly
reinforces
the
conclu
sionth
atwhoever
works
more
outside
the
hom
ew
orksless
inside.
EC
ON
OM
ICS
AN
DID
EN
TIT
Y747
worked
more
than
‘‘Peter’’at
hom
eto
assuage
his
unease
with
the
situation
.Even
tually,sh
equ
ither
job.
VII.
CO
NC
LU
SIO
N
This
papercon
sidershow
identity
affectsecon
omic
outcom
es.F
ollowin
gm
ajorth
emes
inpsych
ologyan
dsociology,
identity
inou
rm
odelsis
basedon
socialdifference.A
person’s
sense
ofselfisassociated
with
differentsocialcategories
and
how
peoplein
these
categoriessh
ould
behave.
This
simple
extension
ofth
eutility
function
could
greatlyexpan
dou
runderstan
ding
ofecon
omic
outcom
es.In
aw
orldof
socialdifferen
ce,on
eof
the
most
impor-
tantecon
omic
decisions
that
anin
dividualm
akesm
aybe
the
typeof
personto
be.L
imits
onth
isch
oicew
ould
alsobe
criticaldeterm
inan
tsofecon
omic
behavior,opportu
nity,an
dw
ell-being.
Identity
affectsecon
omic
behavior
inou
rm
odelsth
rough
four
avenues.
First,
identity
chan
gesth
epayoffs
fromon
e’sow
naction
s.We
capture
this
possibilityby
avalu
eI
s inou
rm
odels.Inou
rstu
dyof
gender
inth
ew
orkplace,for
example,
aw
oman
workin
gin
a‘‘m
an’s’’job
suffersa
lossin
utility,affectin
gth
elabor
supply.S
econd,iden
titych
anges
the
payoffsofoth
ers’actions.W
ecaptu
reth
isextern
alityby
avalu
eI
o inou
rm
odels.A‘‘R
ed’’inou
rpoverty
model,
forexam
ple,is
harm
edby
am
ember
ofhis
own
comm
unity
who
complies
with
the
domin
ant
cultu
re.T
hird,
the
choice,or
lackth
ereof,ofdifferentiden
titiesaffects
anin
dividual’s
econom
icbeh
avior.Inou
rpoverty
model,w
hile
individu
alscou
ldch
oosebetw
eenG
reenor
Red,th
eycou
ldnever
bea
‘‘true’’G
reen.
The
greaterth
eexten
tof
this
socialexclu
sion,
the
greaterth
epossibility
ofequilibria
inw
hich
individu
alsesch
ewrem
unerative
activities.F
inally,
the
socialcategories
and
behavioral
prescrip-tion
scan
bech
anged,
affecting
identity-based
preferences.
This
possibilityexpan
dedth
escope
ofemploym
entpolicy
inou
rm
odelofgen
derin
the
workplace
and
ofeducation
policyin
our
study
ofsocialexclu
sion.
This
paperhas
only
scratched
the
surface
ofth
eecon
omic
implication
sof
identity.A
first
tackin
futu
reresearch
wou
ldbe
contin
ued
analysis
ofparticu
larsettin
gs.Iden
tityis
likelyto
affectecon
omic
outcom
es,for
example,
inareas
ofpolitical
econom
y,organ
izational
behavior,
demograph
y,th
eecon
omics
oflan
guage,violen
ce,education
,consu
mption
and
savings
behavior,
QU
AR
TE
RL
YJ
OU
RN
AL
OF
EC
ON
OM
ICS
748
retiremen
tdecision
s,an
dlabor
relations. 68
As
inth
ispaper,
models
that
incorporate
well-docu
men
tedexistin
gsocial
catego-ries
and
prescriptions
could
yieldnew
results.
Asecon
dtack
inth
isagen
dais
comparative,exam
inin
giden
tityacross
spacean
dtim
e. 69R
esearchers,
forexam
ple,cou
ldcon
siderw
hy
notion
sof
‘‘class’’or
‘‘race’’vary
acrosscou
ntries;
why
migh
tgen
deran
dracialin
tegrationvary
acrossin
dustries;w
hat
migh
texplain
the
risean
dfall
ofeth
nic
tension
s.Such
comparative
studies
wou
ldbe
afru
itful
way
toexplore
the
formation
ofiden
tity-basedpreferen
ces. 70In
peroration,th
ispaper
exploreshow
toin
corporateiden
tityin
toecon
omic
models
ofbeh
avior.M
any
standard
psychological
and
sociologicalcon
cepts—self-im
age,id
ealtype,
in-grou
pan
dou
t-group,social
category,iden
tification
,anxiety,self-d
estruction
,self-realization
,situation
—fit
natu
rallyin
our
framew
ork,allow-
ing
anexpan
dedan
alysisof
econom
icou
tcomes.T
his
framew
orkis
then
perhaps
one
way
toin
corporatem
any
differentnon
pecuni-
arym
otivations
forbeh
aviorin
toecon
omic
reasonin
g,with
consid-
erablegen
eralityan
da
comm
onth
eme.
UN
IVE
RSIT
YO
FC
AL
IFO
RN
IAA
TB
ER
KE
LE
YA
ND
TH
EB
RO
OK
ING
SIN
ST
ITU
TIO
N
UN
IVE
RSIT
YO
FM
AR
YL
AN
DA
TC
OL
LE
GE
PA
RK
RE
FE
RE
NC
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