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Structural Analysis of Xenophobia

We build and estimate a signaling game of xenophobic behaviors to understand to what extent, individual racial animus, perceived unacceptance of racial animus, and the stigma and honor determine xenophobic behaviors in equilibrium. We estimate the model using our newly collected survey data about anti-Chinese xenophobia in the US during the COVID-19 pandemic. We measure xenophobic behaviors from support for xenophobic institutions and relative altruism for a Chinese immigrant during dictator games. To identify racial animus and perceived unacceptance of racial animus, we use novel survey instruments and a factor model to account for measurement errors. We validate our estimates by comparing our model predictions with the causal estimates obtained from the information Randomized Controlled Trial (RCT) implemented during the survey. We found raising perceived unacceptance of racial animus is more effective than reducing racial animus to decrease most xenophobic behaviors we consider. Also, COVID-19 self infection increases xenophobic behaviors in the short run but reduces such behaviors in the long run due to increased reputational gain when abstaining from xenophobic action. Finally, we found the FOX news viewership increases most xenophobic behaviors both in the short run and in the long run.