Individual vs. Social Motives in Identity Choice:
Theory and Evidence from China

by

Ruixue Jia and Torsten Persson

Abstract

This paper studies how individual and social motives shape identities and applies it to the ethnicity choice for children in ethnically mixed marriages. Our theoretical framework highlights the interaction of material benefits, identity costs, and social reputations. It is consistent with two motivating facts for ethnic choices in China, and delivers a set of auxiliary predictions. In particular, due to the interplay between the stigma and the honor of breaking and following prevailing norms, social motives should crowd in (out) changes in material motives in localities where the shares of children that follow the mother's ethnicity is small (large). Empirical tests on Chinese microdata find support for this and other predictions. The estimated effects are quantitatively important and statistically robust. Various alternative theoretical and empirical explanations, including changes in bargaining power, may shed light on the pattern of ethnic choices, but they cannot explain our main finding on the interplay between individual and social motives.