Economics can be baffling, especially to students who learn it in only the theoretical sense. If, for example, your worldview is formed by going through micro/macro classes alone, reality can often be confusing.
Does identity—one’s concept of self—influence economic behavior in the labor market? I investigate this question in rural India, focusing on the effect of caste identity on labor supply. In a field experiment, casual laborers belonging to different castes choose whether to take up various real job offers. All offers involve working on a default manufacturing task and an additional task. The additional task changes across offers, is performed in private, and differs in its association with specific castes. Workers’ average take-up rate of offers is 23 percentage points lower if offers involve working on tasks that are associated with castes that rank higher than their own. This gap increases to 47 pp if the castes associated with the relevant offers rank lower than workers’ own in the caste hierarchy. Responses to job offers are invariant to whether or not workers’ choices are publicized, suggesting that the role of identity itself—rather than social image—is paramount. Using a supplementary experiment, I show that 43% of workers refuse to spend ten minutes working on tasks associated with other castes, even when offered ten times their daily wage. This paper’s findings indicate that identity may be an important constraint on labor supply, contributing to misallocation of talent in the economy.Oh, S. (2019). Does Identity Affect Labor Supply?. Job Marker Paper, Columbia University.
To make the point clearer: microeconomics teaches you that if you are offered ten times your daily wage to do a task for ten minutes, well, duh, you should take it. Reality (well, ok, this paper) teaches you you’d be wrong 43% of the time. At which point, you should begin to ask why.
Sociology gets a bad rap for being an ultra boring field, and there is, one has to admit, some truth to the charge. There are many Dave Barry columns that deserve multiple readings, but this particular one is particularly funny (and relevant):
For sheer lack of intelligibility, sociology is far and away the number one subject. I sat through hundreds of hours of sociology courses, and read gobs of sociology writing, and I never once heard or read a coherent statement. This is because sociologists want to be considered scientists, so they spend most of their time translating simple, obvious observations into scientific-sounding code. If you plan to major in sociology, you’ll have to learn to do the same thing. For example, suppose you have observed that children cry when they fall down. You should write: “Methodological observation of the sociometrical behavior tendencies of prematurated isolates indicates that a casual relationship exists between groundward tropism and lachrimatory, or ‘crying,’ behavior forms.” If you can keep this up for fifty or sixty pages, you will get a large government grant.http://www.xent.com/FoRK-archive/summer96/0342.html
The column is particularly funny because it is particularly true – not just about sociology, but about college in general. Please read the whole thing.
Anyways, back to sociology: yes, boring af, but also helps us economists get a better grip on reality, by pointing out that the world often doesn’t work the way our models would like it to. Thaler* puts this maddening behavior on part of the world down to what he calls Supposedly Irrelevant Factors (SIF’s) (slide 6, if you can’t be bothered to go through the whole thing, although you really should.)
So what is sociology? Here’s the English definition:
Sociology is the study of human behavior. Sociology refers to social behavior, society, patterns of social relationships, social interaction, and culture that surrounds everyday life.https://en.wikipedia.org/wiki/Sociology
… and click here if you want the definition of sociology by a sociologist (consider yourself warned). It is, in essence, a field of enquiry that asks what explains the behavior of people in a society, and also if living in society itself influences how people will behave.
Economic sociology, a subset of sociology, is “the sociological perspective applied to economic phenomena”**. And the reason it is a field of study worth exploring in its own right is because it helps us make sense of potentially baffling results such as the one Suanna Oh came up with.
Read the paper, please (section 6.3 for those of you who are curious about whether the author has really thought things through) – and while you’re at it, learn more about economic sociology. I’m trying to learn more myself, and will keep you guys updated as we go along.
*Yes, that’s from behavioral economics, but the point holds over here too, and is more than mildly relted.
** Smelser, N. J., & Swedberg, R. (Eds.). (2010). The handbook of economic sociology. Princeton university press.