DP8519 Preferences for Consistency

Author(s): Armin Falk, Florian Zimmermann
Publication Date: August 2011
Keyword(s): charitable giving, consistency preferences, early commitment, experiments, social influence
JEL(s): C91, D03, D64
Programme Areas: Financial Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=8519

This paper studies how a preference for consistency can affect economic decisionmaking. We propose a two-period model where people have a preference for consistency because consistent behavior allows them to signal personal and intellectual strength. We then present three experiments that study main predictions and implications of the model. The first is a simple principal-agent experiment that shows that consistency is valued by others and that this value is anticipated. The second experiment underlines the crucial role of early commitment for consistency preferences. Finally we show how preferences for consistency can be used to manipulate choices.