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«Cooperation and the in-group-out-group bias: A field test on Israeli kibbutz members and city residents Bradley J. Ruffle a,∗, Richard Sosis ...»

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Journal of Economic Behavior & Organization

Vol. 60 (2006) 147–163

Cooperation and the in-group-out-group bias:

A field test on Israeli kibbutz

members and city residents

Bradley J. Ruffle a,∗, Richard Sosis b,c,1

a Department of Economics, Ben-Gurion University, Beer Sheva 84105, Israel

bDepartment of Sociology and Anthropology, The Hebrew University of Jerusalem,

Mt. Scopus, Jerusalem 91905, Israel

c Department of Anthropology, U-2176, University of Connecticut, Storrs, CT 06269-2176, USA Received 23 June 2003; accepted 14 July 2004 Available online 9 June 2005 Abstract The in-group-out-group bias is among the most widely documented and analyzed phenomenon in the social sciences. We conduct field experiments to test whether the bias extends to the cooperative behavior of one of the most successful modern collectives, the Israeli kibbutz. Despite their promise as universal cooperators, kibbutz members are more cooperative toward anonymous kibbutz members than they are toward anonymous city residents. In fact, when paired with city residents, kibbutz members’ observed levels of cooperation are identical to those of city residents. Moreover, selfselection rather than kibbutz socialization largely accounts for the extent to which kibbutz members are cooperative.

© 2005 Elsevier B.V. All rights reserved.

JEL classification: C72; C93; P32 Keywords: Cooperation; In-group-out-group bias; Field experiment; Self-selection; Socialization; Kibbutz ∗ Corresponding author. Tel.: +972 8 6472308; fax: +972 8 6472941.

E-mail addresses: bradley@bgu.ac.il (B.J. Ruffle), richard.sosis@uconn.edu (R. Sosis).

1 Tel.: +1 860 486 4264, fax: +1 860 486 1719.

0167-2681/$ – see front matter © 2005 Elsevier B.V. All rights reserved.

doi:10.1016/j.jebo.2004.07.007 148 B.J. Ruffle, R. Sosis / J. of Economic Behavior & Org. 60 (2006) 147–163

1. Introduction The in-group-out-group bias is among the most well documented and widely observed phenomenon in the social sciences. Alternatively known as the intergroup bias, in-group favoritism, and the minimal groups paradigm, the in-group-out-group bias refers to the tendency to evaluate one’s own group or its members (the in-group) more favorably than groups to which one does not belong and its members (the out-group). Literally hundreds of in-group-out-group bias studies fill psychology and sociology journals (see Hewstone et al., 2002 for a recent survey and Rabbie and Horwitz, 1969; Tajfel et al., 1971, and Brewer and Campbell, 1976, for a few of the classic references). This vast literature has demonstrated, among other findings, the ease with which group identity may be called upon or created, the robustness of the bias to different cultures and societies, motivational and cognitive explanations for its existence, and methods to moderate the bias. By contrast, economists have paid little attention to the bias,1 despite its obvious economic implications for negotiations, conflict resolution, competition between groups, international trade agreements, hiring decisions and job discrimination, and numerous issues related to fairness, cooperation and trust.

In this paper, we question the universality of the intergroup bias. We design controlled field experiments to test whether the bias extends to the cooperative behavior of members of one of the most successful communal movements in history, the Israeli kibbutz. Kibbutz members live together, typically work and socialize together, and share equally all earned income, independent of an individual member’s occupation, skills or work effort. What is so striking about the egalitarian and cooperative practices of the kibbutz are their voluntary nature. Members of the kibbutz have freely chosen their lifestyle. They have intentionally removed themselves from mainstream capitalist society to pursue an ideology of socialism and cooperation. If they so desire, kibbutz members may freely abandon the way of life on the kibbutz to (re)join Israeli capitalist society. The fact that kibbutz members are ethnically, culturally, linguistically and visibly indistinguishable from other Israelis testifies to their very low barriers and costs to exiting the kibbutz and the ease with which they may (re)enter the surrounding capitalist culture. It follows that those who choose to join the kibbutz most likely do so out of a desire to live by its egalitarian and cooperative precepts.

Moreover, the raison d’etre and lifestyle of the kibbutz socialize individuals to cooperate not only with one another, but also with Israelis more generally. Ben-Rafael (1997) summarizes the three central components of kibbutz identity as a sense of community grounded in cooperation and egalitarianism, entrepreneurship, and social elitism. By social elitism Ben-Rafael means that kibbutz members perceive their involvement and leadership in social and national causes as their duty. Indeed, a recently formed organization of traditional kibbutzim (the plural of kibbutz) known as “HaZerem HaShitufi” (The Cooperative Trend) 1 Exceptions include Buchan et al. (in press) who study trust and trustworthiness in the investment game with American students who display an ingroup bias, Japanese and Korean students who do not, and Chinese students who actually trust and reciprocate more with outgroup members. Carpenter and Camilo Cardenas (2004) examine extraction rates of Colombian students, American students and mixed groups of Columbian and American students in a common-pool-resource experiment and find Colombians increase their extraction in the mixed groups, while Americans reduce theirs, leaving the overall rate of extraction unaffected.

B.J. Ruffle, R. Sosis / J. of Economic Behavior & Org. 60 (2006) 147–163 149 publicizes as part of its stated goal that “we have to dedicate ourselves to the building of a better society. The kibbutz must respond to the challenge and... be the pioneer leading the crowd” (Frank et al., 1988, p. 53, translated in Ben-Rafael, 1997, p. 20). Kibbutz members have always perceived themselves and portrayed themselves to outsiders as willing to sacrice their own material well-being for the benefit of Israeli society. Putting their lives at risk, early kibbutz members played a central role in the establishment and defense of modern Israel and in the determination of its borders. Although somewhat less dramatic, kibbutz members’ continued sacrifice today can be seen in their active involvement in various forms of voluntary social, national and military service. Kibbutz members are disproportionately represented in the Israeli army’s combat units, volunteer youth groups, community service projects such as the absorption of new immigrants, and in public service positions (see, e.g., Kahane, 1983).

In short, kibbutz members’ freely chosen lifestyle of egalitarianism and cooperation despite possibly more lucrative outside opportunities indicates a commitment to these ideals. Furthermore, the historical role of the kibbutz in founding the modern State of Israel and the continued service of kibbutz members to Israeli society constitute evidence that kibbutz members’ cooperative philosophy extends to Israeli society at large.

Together these observations suggest that if ever there were a society of individuals whose cooperativeness extends equally to members and non-members, the kibbutz is it. Such a finding would constitute a counterexample to the universality of the in-group-out-group bias.

To evaluate whether kibbutz members cooperate to the same degree with fellow kibbutz members and non-members, we design a common-pool resource dilemma game conceptually similar to the sorts of day-to-day consumption problems confronted by kibbutz members. The game is conducted in pairs. In one treatment, kibbutz members from the same kibbutz are anonymously paired with one another. In the other treatment, kibbutz members are paired with Israeli city residents. By comparing kibbutz members’ cooperative behavior in these two treatments we are able to determine if kibbutz members are indeed equally cooperative toward members and non-members, or if they behave less cooperatively toward non-members. Moreover, our second treatment allows us to determine whether kibbutz members are more cooperative individuals than city residents. In addition, data collected during post-experiment interviews allows us to assess to what extent kibbutz socialization versus self-selection contribute to the cooperativeness of kibbutz members.

In the next section, we provide some background on the Israeli kibbutz. Section 3 discusses the samples of kibbutzim and cities selected for our research. Section 4 details the experimental game, procedures and hypotheses. The results are presented in Section 5 and interpreted in Section 6. Section 7 concludes.

2. The Israeli Kibbutz

The kibbutz was originally conceived as a small collective farming settlement in which members based their social and cultural lives on the collective ownership of property and wealth. The first kibbutz, Degania, was established in the Galilee in 1909. Today, the 150 B.J. Ruffle, R. Sosis / J. of Economic Behavior & Org. 60 (2006) 147–163 more than 270 kibbutzim are modern cooperative communities engaged in the production of the entire gamut of goods and services in high technology, manufacturing, tourism and agricultural industries using the most modern production techniques. The approximately 124,000 individuals currently living on kibbutzim comprise around 2% of the Israeli population.

The kibbutz developed out of a socialist egalitarian ideology as well as the pragmatism of group living by Eastern European Jews during the years leading up to the establishment of the modern State of Israel. Guided by the dictum “from each according to his abilities, to each according to his needs,” the traditional model of the kibbutz prescribes that each member receives food, shelter, clothing, education, health care, and an equal share of the income generated by the kibbutz. An equal division of income holds whether one is the dishwasher in the communal dining hall, the CEO of the computer chip plant, the kibbutz gardener or retired. Income on the kibbutz is thus divided equally regardless of profession, skill or effort level. In this sense, the generation of income or production is a public-good problem. Consumption on the kibbutz, by comparison, represents a classic tragedy of the commons problem: kibbutz members enjoy equal and unrestricted access to non-renewable consumption goods. For example, the costs associated with a member’s consumption of food, water, electricity and the use of communal cars are borne by the kibbutz, not the individual. Cooperation and self-restraint are thus necessary to prevent the depletion of these common-pool resources and to ensure the continuity of the kibbutz.2 The continuation of the kibbutz should not be regarded as self-evident in view of the decline of many kibbutzim that began in the mid-1980s. Concern for economic viability on these faltering kibbutzim set in motion numerous structural changes that transfer the control of certain resources and the costs of consumption from the collective to the individual household. The most radical change in this process referred to as “privatization” permits differential salaries between kibbutz members.3

3. Sample

For the purposes of this paper, we chose four highly collectivized (non-privatized) kibbutzim.4 The four participating kibbutzim were established between 1943 and 1949, are located in central and southern Israel, each with between 500 and 700 members, and all moderately to very economically successful. We also selected neighborhoods in seven towns and cities in central and southern Israel to match the different standards of living among our four sample kibbutzim. These cities are Beer Sheva, Hadera, Maitar, Omer, Or Yehuda, Rehovot and Rishon Lezion.

2 See Ostrom et al. (1994) for a thorough theoretical, experimental and empirical treatment of common-pool resources.

3 Ben-Rafael provides an excellent treatment of the economic and social changes on the kibbutz that accompanied privatization.

4 Using data collected by Shlomo Getz on the number of privatization changes adopted by each kibbutz, the four kibbutzim in our sample made between one and four changes (out of a possible 23). For work comparing cooperation on privatized and collectivized kibbutzim see Sosis and Ruffle (2004).

B.J. Ruffle, R. Sosis / J. of Economic Behavior & Org. 60 (2006) 147–163 151

4. Experimental hypotheses, design and procedures

4.1. Experimental design The logistics of our field experiments and the nature of our subject pool raise several essential considerations in the choice of an experimental game.5 First, kibbutz members live together, and work and socialize with one another on a daily basis. Assuring subject anonymity is, therefore, of prime importance. For this reason, we chose to conduct these experiments in the privacy of the individual members’ homes rather than in a communal space. Second, to allow for the comparison of kibbutz members’ choices with those of city residents when the two groups are matched with one another, we require a symmetric game.

We selected a one-shot game for two reasons. First, we wanted to capture participants’ initial willingness to cooperate. Our question of interest is not whether kibbutz members are able to learn to cooperate with city residents to the same degree that they cooperate with members of their own kibbutz. A more obvious reason for the choice of a one-shot game is that a repeated game complicates considerably subjects’ decision task by introducing additional strategic considerations. Given the diversity of the subject pool in terms of education, age and occupation, we sought a conceptually simple game.

As for the particular nature of the experimental game, issues of cooperation and selfrestraint confront kibbutz members on a daily basis. As discussed in Section 2, almost all consumption goods on a kibbutz are common-pool resources in the sense that they are exhaustible and equally accessible to all kibbutz members. We, therefore, wanted a game that captures an element of the common-pool resource dilemmas familiar to kibbutz members.

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