Scandinavian Working Papers in Economics

Working Paper Series,
Research Institute of Industrial Economics

No 642: Peers and Culture

María Sáez-Martí and Anna Sjögren ()
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María Sáez-Martí: The Research Institute of Industrial Economics, Postal: P.O. Box 55665, SE-102 15 Stockholm, Sweden
Anna Sjögren: The Research Institute of Industrial Economics, Postal: P.O. Box 55665, SE-102 15 Stockholm, Sweden

Abstract: We analyze the evolution of cultural traits when parents purposefully invest resources in order to socialize their children to the cultural traits that maximize child lifetime utility. We assume that children are not passive in their adoption of traits from peers. Instead they are guided by an evaluation of the merit of traits. We show that such evaluation is likely to render this process of "oblique transmission" biased. We then show that when transmission of traits from society is biased or frequency dependent, cultural diversity is sustainable even when all parents strive to transmit the same trait. We also show that demand for cultural pluralism on the part of parent does not guarantee cultural diversity.

Keywords: Peer Groups; Cultural Transmission; Cultural Diversity; Oblique Transmission

JEL-codes: D10; I20; J13

17 pages, May 12, 2005

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