ECO Research Seminar-Internal | The Resilience and Reinforcement of Group Cohesion in the Face of Economic Inequality

Title: The Resilience and Reinforcement of Group Cohesion in the Face of Economic Inequality

Abstract: Building on recent evidence that group cohesion is a powerful determinant of economic efficiency, we hypothesise that income inequality influences efficiency by altering cohesion, and that the direction of the effect depends on the nature of inequality. To test this, we employ a novel experimental design with extensive group interactions and a state-of-the-art technique to measure group cohesion. Our findings confirm that stronger group cohesion is indeed associated with more efficient interactions. We also find that group cohesion is significantly strengthened by inequality between groups, a mechanism overlooked in the literature to date. Furthermore, contrary to expectations, we do not find that pay
inequalities within groups hinder the formation of group cohesion. These results suggest that interpersonal relationships display resilience to economic disparities, challenging the prevailing argument that inequality must be harmful to cohesion, and undermining a potential pathway through which inequality it could harm efficiency.

Speaker: Dr Jan Jozwik from University of Nottingham Ningbo China

Jan Jozwik holds a PhD in Economics from the University of Oxford and is an Assistant Professor of Economics at the University of Nottingham Ningbo China. His research lies at the intersection of experimental and behavioral economics, development economics, environmental economics, and cost-benefit analysis, with a particular interest in applying experimental methods to important economic and policy questions. His research has been published in Food Policy, Applied Economics, and The Journal of the Economic Science Association.