Cultural integration: Experimental evidence of convergence in immigrants' preferences

Cultural traits play a significant role in the determination of economic outcomes and institutions. This paper presents evidence from laboratory experiments on the cultural integration of individuals of Chinese ethnicity in Australia, focusing on social preferences, risk attitudes, and preferences for competition. We find that greater exposure to Western culture is in general associated with a convergence to Western norms of behaviour. Specifically, the share of education an individual receives in the West has a strong negative impact on altruism, trust towards individuals of Chinese ethnicity, and trustworthiness, while it has a significant and positive impact on trust towards Australians. For risk and competitive preferences, our results are gender-specific. These findings have important implications for policy making and institution building in multi-cultural societies.