Images and norms

Abstract

This paper considers an image-conscious decision maker (DM) who cares not only about the direct consequences of his actions, but also about how these actions can be psychologically rationalized—are his actions considered generous, patient, sophisticated, etc.? image-consciousness nests both shame-driven preferences (wanting to conceal information) and signaling (wanting to reveal information; e.g., conspicuous consumption). A specific type of image-consciousness is norm driven behavior whereby the DM derives additional utility whenever his choices are consistent with a set of prescribed norms. The notion of consistency determines the DM’s attitude towards information revelation. This paper axiomatizes the behavior of an image/norm concerned DM and identifies the DM’s value to inducing an image or adhering to a norm.