Economics and Identity*

2000/08/01 by George A. Akerlof, Rachel Kranton, Rachel E. Kranton · 5,645 citations
Economics, Econometrics and Finance · Psychology · Social Sciences · #Affect (linguistics) #Computer science #Construct (python library) #Economic Policies and Impacts #Economic growth #Economics #Function (biology) #Gender, Labor, and Family Dynamics #Identity (music) #Identity formation #Labor market dynamics and wage inequality #Positive economics #Poverty #Psychology #Self-concept #Social group #Social identity approach #Social identity theory #Social psychology #Sociology

paper · open access · doi:10.1162/003355300554881

published in The Quarterly Journal of Economics 115(3), 715-753 (Oxford University Press)

openalex publication_date 2000/08/01 · openalex created_date 2025/10/10 · openalex updated_date 2026/08/06

Abstract

This paper considers how identity, a person's sense of self, affects economic outcomes. We incorporate the psychology and sociology of identity into an economic model of behavior. In the utility function we propose, identity is associated with different social categories and how people in these categories should behave. We then construct a simple game-theoretic model showing how identity can affect individual interactions. The paper adapts these models to gender discrimination in the workplace, the economics of poverty and social exclusion, and the household division of labor. In each case, the inclusion of identity substantively changes conclusions of previous economic analysis.

Citations

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