I Think About You: Group Mentality and Altruism Among Farmers

Does exposure to reminder of resource scarcity lead individuals toward generous or selfish behavior? I estimate the effect of resource scarcity information on the number of farmers applied for the new crops program that provides temporary income subsidy using a field experiment. The result shows that the number of applicants in villages that received resource scarcity information, indicating that the number of farmers joining the program was limited in each village, is significantly lower than that of the villages that received no such information. And, a lab-in-the-field experiment reveals that when resource scarcity is salient, farmers tend to sacrifice their benefit to increase the benefit of others who are identified as their ingroup members. However, I do not find this generous behavior toward outsiders. Together, the results suggest that the exposure to resource scarcity information would not always guide people to focus on maximizing their own welfare, rather it may lead people to behave generously if resources are shared among their ingroup members.