Abstract

Social relationships affect many variables that naturally interest economists yet they barely feature at all in conventional economic analysis. In an extensive bank of experiments, we examine the predictive power of a simple and portable tool, developed in social psychology, for the purpose of measuring social relationships. This is the so-called oneness scale. We deploy the tool in an experiment where groups of subjects who vary in the extent of pre-existing social relationships, also play weak-link coordination games played by groups of subjects. Our results are striking. Despite no possibilities for communication, groups with high oneness are very likely to coordinate on highly Pareto-ranked equilibria while groups with low oneness never do; hence, sufficiently high oneness appears a necessary condition for coordination success. While oneness co-varies, as expected, with various objective characteristics of groups, surprisingly, in the presence of oneness no other factors are ever significant. The effects of oneness are also large when benchmarked against the impact of financial incentives. We view our results as providing significant proof of concept for oneness measurement as a potentially highly productive tool for economic research.