Lionel Page Profile picture
Aug 24 19 tweets 6 min read Twitter logo Read on Twitter
It is hard to overstate the importance of social norms. They dictate how we should behave with others in our countless daily social interactions. But what are they? A 🧵on how game theory helps unveil what social norms are and how they work. Image
What are social norms? In an influential 2001 article, Christine Horne emphasised that the jury was still somewhat out in sociology about the nature of norms, how they work and how they emerge. Image
Sociology has however produced a set of classical ideas about social norms. Durkheim, the father of the discipline, stressed that they are constraints imposed by society on individuals, and they are beyond individuals’ control. Durkheim (1912): Image
These norms are internalised by individuals, shaping their preferences and beliefs, and leading to feelings of guilt and shame when they violate the norms. Parsons and Shils (1951): Image
This vision of social norms coming from “society” and constraining individuals with limited agency has influenced social sciences and even popular discussions about norms, in particular when they are criticised, like gender norms. Image
But this vision raises questions: How does “society” impose norms? Why do we have some norms rather than others? How do norms evolve?
Game theory helps answer these questions by shifting our understanding of what norms are: they are equilibria of social games. Image
The philosopher David Lewis (1969) was one of the first scholars to propose that they are the equilibria of social games where we need to coordinate our behaviours and expectations. Image
A typical example is the choice of driving on one side of the road. For arbitrary reasons, a country may have adopted one side instead of the other as a convention. It is then in the interest of every driver to follow this convention and not deviate. Image
Situations requiring social coordination are everywhere: from walking in the street to talking turns speaking in meetings. We need a shared understanding to navigate these social interactions.
When we break social norms, we break all this shared understanding with other people. That is why it is hard to break norms and we feel bad about it. There is much more at stake than the specific norm violated. Image
The game theorist Ken Binmore extended this understanding to norms of fairness.
There are many ways to agree to cooperate and share the gains from cooperation. Norms of fairness allow us to seamlessly coordinate and agree on one of the many possible solutions. Image
Game theory therefore helps recover key insights from sociology about social norms:
- They are external to individuals because they are equilibria: stable configurations of behaviours and expectations.
- They constrain individuals because deviations from equilibria are costly.
At the same time, it helps us answer the puzzles about norms:
- People are not social pawns following norms blindly but actors trying to navigate social situations successfully
- Shame and guilt are psychological warnings reflecting the future possible costs of deviations
Understanding norms as social equilibria also helps us understand that:
- They can be “bad” (collectively undesirable)
- “Bad” norms can be hard to change, even if most people think they are bad!
Bicchieri (2005): Image
Norms tend to be sticky, but when they change they tend to change quickly as society shifts from one equilibrium of behaviours and expectations to another one. The dynamics of the changes in laws on marijuana or same-sex marriage are good examples. Image
When a norm changes, attitudes tend to change quickly too. Instead of people being brainwashed by internalised norms, their views can be very flexible when the whole society shifts to another norm. Image
Understanding norms as equilibria also explains the role of leaders and role models in changing norms. They can act as coordination devices. When they recommend changing a norm, it can help people trust that others will synchronously change their behaviour and expectations. Image
In conclusion, viewing social norms as social equilibria helps us understand how they work. It also helps us appreciate that people are not social pawns. They are actors who try to successfully navigate social games, though they (mostly) do not set the games’ rules. End/
This thread builds on this recent post which is part of a series on how game theory helps make sense of a wide range of behaviours.
tinyurl.com/36ttyb9b
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More from @page_eco

Jul 28
Game theory is not just a geeky discipline looking at contrived strategic situations. It is relevant to understand our everyday social interactions.
A🧵with an introduction for everyone to game theory and its history. Image
Let's step back to the 1920s-1930s. Many economists assumed that people can perfectly anticipate the decisions of others in the economy, making it possible for the economy to be in “equilibrium” where supply is equal to demand. Image
An Austrian economist, Oskar Morgenstern, pointed in 1935 to a major flaw in the assumption of perfect foresight. Anticipating other people’s action is difficult: their actions depend on their anticipation about our actions. This leads to an endless loop of mind guessing. Image
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Jul 14
The downfall of famous researchers associated with behavioural economics, Ariely and Gino, is raising new questions about the findings from the field.
Have we gone too far with the idea that humans are riddled with cognitive biases? A 🧵
Behavioural economics is often characterised as having established a long list of biases. But what do these biases really tell us about human cognition?
Let's start with a conventional definition of "bias". The Encyclopedia Britannica defines “cognitive biases” as “systematic errors in the way individuals reason about the world due to subjective perception of reality.” So biases are associated with errors. Image
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Jun 29
Prospect Theory's famous “S-shaped” value function is a cornerstone of behavioural economics. Surprisingly, more than 40 years after its inception, there seem to be a lot of remaining puzzles about it.

Or... perhaps not anymore. A 🧵that may change your view on Prospect Theory.
Since its publication in 1979, "Prospect Theory" by Kahneman and Tversky has become the most cited article in economics. One of its key ideas is that people value what they have by considering it as a gain or a loss relative to a subjective "reference point".
What is this reference point? Kahneman and Tversky did not propose a strict definition. It could be the status quo (what you have), expectations (what you think you'll get), or aspirations (what you would want to get).
https://t.co/55HZx44x8mjstor.org/stable/1914185
Read 21 tweets
Jun 15
The confirmation bias is one of the most widely known cognitive biases. It reflects the fact that we favour information that confirms our existing beliefs.
But contrary to this accepted wisdom, looking for confirmatory information is likely not a bias at all. 🧵 Image
The confirmation bias has been described as a candidate for being the “single problematic aspect of human reasoning that deserves attention above all others”. (Nickerson, 8500 Scholar citations) Image
Interest in the confirmation bias has also grown with the rise of political polarisation in several Western countries. This bias appears to contribute to the phenomenon of "echo chambers," where people are exposed only to opinions that reinforce their pre-existing views. Image
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Jun 8
For 30 years psychologists and behavioural economists dismissed the "hot hand," the idea that basketball players get better at shooting after a streak of success. As it happens, the academics were wrong all along. The hot hand is real. 🧵 Image
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You may wonder: Why would three psychologists specialised in judgement and decision-making investigate the performance of basketball players? Image
One insight gained from Kahneman and Tversky’s “heuristic and biases” research program is that people are not really good at grasping randomness. When seeing a streak of events generated randomly people tend to think it is not random. Image
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May 29
Not another bias!
Behavioural economics has excelled in identifying biases. We have now reached the point of diminishing returns in this quest.
What lies ahead in behavioural sciences? Making sense of the reasons we behave the way we do. 🧵 Image
Science is not immune to trends. After a swing of the pendulum against rationality with behavioural economics, the pendulum has started to swing again towards an interest in adaptive explanations of human behaviour.
👇Benabou and Tirole (Mindful Economics, JEP, 2016) Image
Indeed, it is the perspective I develop in "Optimally Irrational", which shows how puzzling and seemingly wrong behaviours uncovered by behavioural economics have actually very good reasons to exist.
cambridge.org/9781009209205 Image
Read 10 tweets

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