Identity change and economic mobility: Experimental evidence

Abstract

I study the impact identity change (assimilation) has on economic mobility. I experimentally assign people to different group identities, majority or minority, before they interact in a social coordination setting. In equilibrium, minority assimilators achieve economic mobility by integrating with the majority. In the experiment, assimilators are discriminated against and cannot integrate, if majority members encounter conformists (non-assimilators) in the minority. Thus, assimilators fail to attain economic mobility because those who maintain the status quo impose negative externalities on those who risk changing it.