Social Identity Theory

Identity Economics bridges a critical gap in the social sciences. It brings identity and norms to economics. People’s notions of what is proper, and what is forbidden, and for whom, are fundamental to how hard they work, and how they learn, spend, and save. Thus people’s identity—their conception of who they are, and of who they choose to be—may be the most important factor affecting their economic lives.

In The Red Mirror, Gulnaz Sharafutdinova uses social identity theory to explain Putin's leadership. The main source of Putin's political influence, she finds, lies in how he articulates the shared collective perspective that unites many Russian citizens. Under his tenure, the Kremlin's media machine has tapped into powerful group emotions of shame and humiliation - derived from the Soviet transition in the 1990s - and has politicized national identity to transform these emotions into pride and patriotism.