How to talk about an out-group: Effects on in-group trust and out-group generosity

This paper examines how deliberation in an in-group on how much to share with an out-group affects in-group trust and out-group generosity. In a lab-in-the-field experiment with 13 schools, we randomly assign school minors into pairs that decide how much of a common fund to transfer to refugee minors. Treatments vary whether pairs partake in a free-form chat or write down their reasoning individually. After treatment, they vote on transfers. In our sample, communication on refugees is shaped by a political-correctness norm: it is more refugee-friendly than individual reasoning, and it increases optimism within pairs about the partner's refugee-friendliness. Subjects trust their partners the more, the more refugee-friendly they believe them to be. This is rational in our sample since more refugee-friendly subjects turn out more trustworthy. Communication also has a positive impact on willingness to collectively share funds with refugee minors. Hence, our experiment indicates that in our sample, both the in-group and the out-group profit from a political-correctness norm to speak well of the out-group.