... one does not argue about tastes for the same reason that one does not argue over the
Rocky Mountains - both are there, will be there next year, too, and are the same to all
men.“ (Stigler and Becker 1977, p. 76)
“Almost all sociologists take it as obvious that individuals‘ preferences are formed by
society and that society, so to speak, exists within persons.“ (Peter Hedstrom, Oxford
University, personal communication)
There is a standard view in economics that to explain outcomes, one can begin by characterizing
the preferences of individuals and then go on to describe the society that the individuals will
create. The preferences remain the same regardless of the society that emerges. This view
contrasts sharply with the conception of the individual in other social sciences, in which
institutions and other socially defined variables influence preferences. Casual observation
suggests that there are vast behavioural differences across societies and even across groups
within societies, and cross-cultural research has documented striking differences in preferences
across societies (e.g. Henrich et al. 2005, Henrich et al. 2010). However, despite the
documentation of large cultural differences, conclusive scientific evidence that preferences are
causally shaped by social institutions and cultural practices is very rare.
Take, for example, the study of Henrich et al. (2010), which shows that the preferences of
individuals to be fair in anonymous transactions and to punish unfairness increase with the level
of the society’s market integration, measured as households’ average percentage of calories that
are purchased. It is a plausible hypothesis that market integration shapes preferences for fairness
because in market exchanges the quid pro quo is a salient characteristic of interactions that may
support the development of such preferences. However, it is also possible that stronger fairness
preferences, e.g. preferences to honour informal contractual obligations, foster market
integration.1 Thus, one cannot unambiguously conclude from the observed correlations that the
cultural and economic institutions prevailing in the different societies have causally shaped the
preferences for fairness and punishment.
1 The positive correlation between altruistic punishment and community size can also be interpreted in two ways. It
is a plausible hypothesis that larger communities develop more elaborate forms of institutional punishments that, in
turn, increase the willingness of individuals to punish altruistically. However, it is also plausible that a higher
willingness to engage in altruistic punishment enables small-scale societies to enforce the social norms that support
the development of larger, more productive communities.