Endogenous Preferences andConformity: Evidence From aPilot Experiment S B

Conformity behavior, i.e. the agreement between an individual’s choices and the prevailing be-havior of a reference group, is a commonly observed phenomenon. Though some types of social interactions may give raise to specific incentives to adopt either a majoritarian or a contrarian behavior, we want to investigate whether the same behavioral pattern emerges even when no eco-nomic motivator is present. To accomplish this task, we employ an experimental Vickrey median price auction designed to provide incentives to reveal individual preferences truthfully. Whereas we feed the control group with just the median price, we give out additional information on other players ’ bids for those in the treated groups. These informations are designed toprovide hints at revising individual bids. Ourmain results point to a strong tendency of the individuals to adapt their behavior to those of the individuals which can be observed. Moreover, although a clear shaping effect (a regression toward the median price) does emerge for the control group, the provision of information about the actual behavior of a sample of the relevant group is able to minimize or neutralize the shaping effect. Specifically, we find that players adjust to a divergence between their bids and the average bid of a reference group by a factor of .—.. These figures point to a relevant role for conformity in group behavior