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Abstract
We study the impact of social identity on risk sharing behavior in an ethnically diverse
society in the Central Highlands of Vietnam. We ran Solidarity Games with 285 male
household heads from two distinct ethnic groups. We varied participants' social identity
by altering the ethnic composition in the risk-sharing group of three. Our main strategy is
to influence identity induced solidarity towards the unlucky coplayer by manipulating the
identity of the non-affected third player. Our results are consistent with social identity theory,
predicting that identity is endogenous to group composition. We partially confirm existing
evidence on in-group favoritism, once identity becomes salient. Additionally, we find that
those subjects that constitute the minority in the risk-sharing group show adaptive behavior
by imitating the perceived norm of the dominant ethnic group. These results suggest that
identity is context specific. Particularly, the rather disadvantaged group in the heterogeneous
society seems to adapt their behavior to the social environment.