Out-group homogeneity bias, also known as the out-group homogeneity effect, is one’s perception of out-group members as more similar to one another than are in-group members. Thus “they are alike; we are diverse”. People have a more differentiated cognitive representation of in-groups than of out-groups.
The out-group homogeneity bias relates to the social identity theory, which is how people examine the social identity that comes from group memberships. Social identity theory states that humans: categorize people, themselves included; identify with in-groups; and compare their own groups with other groups (out-groups). Identification with in-groups promotes self-esteem; by comparing ourselves with out-groups, we gain a favorable bias toward our in-group, known as in-group bias. This in-group bias supports a positive self-concept – we can make ourselves feel better by identifying more strongly with it. The relationship of in-group bias to the desire to achieve a positive self-concept is similar to the self-serving bias (the tendency to perceive oneself favorably) except on a group level. In-group bias can even be developed against the out-group even when there is no logical basis for doing so. This means that even if the group categorization is meaningless, humans will identify more with their in-group and engineer a more positive social identity.
Relative to the out-group homogeneity bias and the social identity theory, there is also a correlation between intergroup discrimination and collective self-esteem, which is the esteem associated with category membership. So not only do we gain self-esteem by identifying with in-groups, we also gain collective self-esteem.
This bias was found to be unrelated to the number of group and non-group members individuals knew. One might think that people thought members of their own groups were more varied and different simply because they knew them better, but this is actually not the case. The out-group homogeneity bias was found between groups such as “men” and “women” who obviously interact frequently.
The implications of this effect on stereotyping have been noted. Social perceivers tend to have impressions about the diversity or variability of group members around those central tendencies or typical attributes of (out-) group members. Out-group stereotypicality judgments are overestimated, supporting the view that out-group stereotypes are overgeneralizations.