Coordination and Culture

Culture constrains individual choice by making certain behaviour taboo.  We propose an evolutionary model in which members of different groups attempt to coordinate over time.  We show that cultural constraints can lead to a permanent break down in coordination between groups, even when coordination is attainable and Pareto-efficient.  Hence restrictive cultures make coordination with out-group members more difficult.  By limiting a person's options, however, highly restrictive cultures act as a strategic commitment, forcing out-group members to conform to in-group norms if they want to coordinate.  In this way, cultural constraints on behaviour may lead to higher expected welfare.  When people rationally choose their culture, we demonstrate that restrictive and permissive cultures can co-exist in the long run.