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Collective narcissism (or group narcissism) extends the concept of individual narcissism onto the social level of self. It is a tendency to exaggerate the positive image and importance of a group the individual belongs to – i.e. the ingroup. While the classic definition of narcissism focuses on the individual, collective narcissism asserts that one can have a similar excessively high opinion of a group, and that a group can function as a narcissistic entity. Collective narcissism is related to ethnocentrism. However, ethnocentrism primarily focuses on self-centeredness at an ethnic or cultural level, while collective narcissism is extended to any type of ingroup, beyond just cultures and ethnicities. While ethnocentrism is an assertion of the ingroup's supremacy, collective narcissism is a self-defensive tendency to invest unfulfilled self-entitlement into a belief about ingroup's uniqueness and greatness. Thus, the ingroup is expected to become a vehicle of actualisation of frustrated self-entitlement. When applied to a national group, collective narcissism is similar to nationalism: a desire for national supremacy. Positive overlap between ingroup satisfaction and collective narcissism suppresses collective narcissistic intergroup hostility.

Development of the concept