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A Theory of Tolerance

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  • Corneo, Giacomo
  • Jeanne, Olivier

Abstract

We develop an economic theory of tolerance where styles of behaviour are invested with symbolic value. Value systems are endogenous and taught by parents to their children. In conjunction with actual behaviour, value systems determine the esteem enjoyed by individuals. Intolerant individuals have all symbolic value invested in a single style of behaviour, whereas tolerant people have diversified values. The proposed model identifies a link between the unpredictability of children's lifestyles and tolerance. Under uncertainty, an open mind performs like an insurance against the risk of suffering a large loss in self-esteem when adult. From another angle, tolerance makes people capable of fully exploiting market opportunities. Sometimes, public policies in favour of tolerance can be recommended on efficiency grounds.

Suggested Citation

  • Corneo, Giacomo & Jeanne, Olivier, 2006. "A Theory of Tolerance," CEPR Discussion Papers 5908, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:5908
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    More about this item

    Keywords

    Symbolic values; Tolerance; Modernity; Occupational choice;
    All these keywords.

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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