Leaders as role models and ‘belief managers’ in social dilemmas

Simon Gächter,Elke Renner

doi:10.1016/j.jebo.2018.08.001

Simon Gächter, Elke Renner

Open Access

https://doi.org/10.1016/j.jebo.2018.08.001

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Abstract

We investigate the link between leadership, beliefs and pro-social behavior in social dilemmas. This link is interesting because field evidence suggests that people's behavior in domains like charitable giving, tax evasion, corporate culture and corruption is influenced by leaders (CEOs, politicians) and beliefs about others’ behavior. Our framework is a repeated experimental public goods game with and without a leader who makes a contribution to the public good before others (the followers). We find that leaders strongly shape their followers’ initial beliefs and contributions. In later rounds, followers put more weight on other followers’ past behavior than on the leader's current action. This creates a path dependency the leader can hardly correct. We discuss the implications for understanding belief effects in naturally occurring situations.

Highlights

“Once you as a CEO go over the line, people think it‘s okay to go over the line themselves.” Lawrence Weinbach, Head of Unisys
Since belief effects matter in the absence of leaders, which characterizes many of the situations discussed above, we look at belief effects in a public goods game without a leader
We looked at leaders as a potentially strong belief-shifters and compared the leader-setting to a setup without a leader

Summary

Introduction

“Once you as a CEO go over the line, people think it‘s okay to go over the line themselves.” Lawrence Weinbach, Head of Unisys. (quoted after The Economist, July 27, 2002, p.58). May induce people to do the same (as suggested by our opening quotes) and may nurture people’s beliefs that other people will do the same. This may exacerbate the problem to the extent that people’s behavior is shaped by the leader’s example and by their beliefs about other people’s actions. We aim to contribute to a better understanding how leaders shape the beliefs of a group of people and their actual pro-social behavior. A leader-follower framework has the advantage that we can observe how the leader’s action influences followers’ beliefs. We contrast the leader treatment with a “no-leader treatment” in which all group members decide simultaneously.

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