Exposure to diversity, social proximity and ingroup bias

Abstract As society becomes increasingly diverse, will changes in an individual’s exposure to diversity influence their interactions with others? I study prosocial behaviour in an experiment on a large-scale U.S. sample, in which participants are exogenously exposed to social contexts with varying levels of nationality diversity. I find that diverse contexts amplify participants’ ingroup bias—the tendency to favour one’s own group—driven by higher allocations towards fellow nationals and lower allocations to foreigners, relative to giving in homogeneous contexts where such bias is not present. I provide suggestive evidence that changes in perceptions of social proximity correspond to a driver of the effect of diversity on allocations. The findings are consistent across subgroups of the population, which suggests that the study identifies a general process through which individuals identify with groups, where social context—and not only individual characteristics—is key for the emergence of ingroup bias.