Drawing from social categorization theory, we found that greater demographic heterogeneity
led to group norms emphasizing lower cooperation among student teams and
officers from ten business units of a financial services firm. This effect faded over time.
Perceptions of team norms among those more demographically different from their
work group changed more, becoming more cooperative, as a function of contact with
other members. Finally, cooperative norms mediated the relationship between group
composition and work outcomes.