CeDEx Seminar - Simon Gaechter (University of Nottingham)

How social relationships affect social preferences and group cooperation: Evidence from randomly assigned real groups

Social relationships are ubiquitous but poorly understood in economic analysis. Here, we investigate how relationship closeness influences social preferences and cooperation in real groups using experimental games typically conducted under anonymity. Leveraging the randomized assignment of Swiss Army officer trainees to four-week training units, we measure relationship closeness with the “oneness” tool from social psychology. Our findings confirm that closeness causally develops as predicted by relationship psychology. The impact on social preferences is modest but oneness significantly increases the likelihood of unconditional cooperation among close partners. Cooperation rates in social dilemma games are higher between close partners than distant ones. A simultaneous equation model reveals that oneness, social preferences, cooperative attitudes, and beliefs about others’ cooperation collectively drive cooperation. Our results highlight the distinct role of social relationships in fostering cooperation without strategic reasons to cooperate.