nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2005‒11‒05
twenty-two papers chosen by
Fabio Sabatini
Universitá degli Studi di Roma, La Sapienza

  1. Cross-Country Determinants of Life Satisfaction: Exploring Different Determinants across Groups in Society. By Christian Bjørnskov; Axel Dreher; Justina A.V. Fischer
  2. Networks of Relations By Steffen Lippert; Giancarlo Spagnolo
  3. Macro Measures And Mechanics of Social Capital By Luke Keele
  4. Social Attitudes, Labor Law, and Union Organizing: Toward A New Economics of Union Density By Thomas I Palley; Robert M. LaJeunesse
  5. Social Networks in Ghana By Christopher Udry; Timothy G. Conley
  6. Compensation for Environmental Services and Rural Communities: Lessons from the Americas By Herman Rosa; Deborah Barry; Susan Kandel; Leopoldo Dimas
  7. AGENCY, ASSOCIATIONS AND CULTURE: A THALE OF STATE AND SOCIETY By Ioan Talpos; Bogdan Dima; Cosmin Enache; Mihai Ioan Mutascu
  8. Local Public Good Provision: Voting, Peer Effects, and Mobility By Stephen Calabrese; Dennis Epple; Thomas Romer; Holger Sieg
  9. Social Capital, Creative Destruction and Economic Growth By Adelina Gschwandtner; Michael A. Hauser
  10. Local Learning, Trade Policy and Industrial Structure Dynamics By Facundo Albornoz and Paolo Vanin
  11. Partenariato locale e capitale relazionale ''potenziale'' in provincia di Foggia By Roberta Sisto; Antonio Lopolito; Gianluca Nardone
  13. Using Experimental Economics to Measure the Effects of a Natural Educational Experiment on Altruism By Eric Bettinger; Robert Slonim
  14. Does Marriage Make People Happy, Or Do Happy People Get Married? By Alois Sutzer; Bruno S. Frey
  15. Young Women's Religious Affiliation and Participation as Determinants of High School Completion By Evelyn L. Lehrer
  16. Job Hopping in Silicon Valley: Some Evidence Concerning the Micro-Foundations of a High Technology Cluster By Brice Fallick; Charles A. Fleischmann; James A. Rebitzer
  17. High Performance Workplaces and Family Friendly Practices: Promises Made and Promises Kept By John S. Heywood; W.S. Siebert; Xiangdong Wei
  18. Intra-household Work Time Synchronization: Togetherness or Material Benefits? By Chris van Klaveren; Henriëtte Maassen van den Brink
  19. Mind the Gap - Bridging the Gender Gap in Developing Regions By Alessandro Magnoli
  20. An Empirical Model of Labor Supply with Social Interactions By Andrew Grodner; Thomas Kniesner
  21. Barriers to network-specific innovation By Antoine Martin; Michael J. Orlando
  22. Stressed Out on Four Continents: Time Crunch or Yuppie Kvetch? By Daniel S. Hamermesh; Jungmin Lee

  1. By: Christian Bjørnskov; Axel Dreher; Justina A.V. Fischer
    Abstract: This paper explores a wide range of determinants of life satisfaction exploiting a database of 73 countries, based in turn on about 100 000 observations. The determinants can be categorized in four groups: political, economic, institutional factors and human development and culture. The relevance of these factors is estimated on country-level averages of satisfaction of sub-groups of national populations according to gender, income and political orientation, using OLS, robust regression and Extreme Bounds Analysis techniques. Our results show that only a small number of factors robustly influence life satisfaction across countries while the importance of a large number of alternative factors suggested in the previous literature is rejected.
    JEL: I31 H10 H40
    Date: 2005–10
  2. By: Steffen Lippert (Université Toulouse 1 and Universität Mannheim); Giancarlo Spagnolo (Department of Economics, Stockholm School of Economics, C.E.P.R. ans Consip Spa.)
    Abstract: We model networks of relational (or implicit) contracts, exploring how sanctioning power and equilibrium conditions change under different network configurations and information transmission technologies. In our model, relations are the links, and the value of the network lies in its ability to enforce cooperative agreements that could not be sustained if agents had no access to other network members' sanctioning power and information. We identify conditions for network stability and in-network information transmission as well as conditions under which stable subnetworks inhibit more valuable larger networks.
    Keywords: Networks, Relational Contracts, Indirect Multimarket Contact, Social Capital.
    JEL: L13 L29 D23 D43 O17
    Date: 2004–11
  3. By: Luke Keele (Nuffield College & Oxford University)
    Abstract: Interest in social capital has grown as it has become apparent that it is an important predictor of collective well-being. Recently, however, attention has shifted to how levels of social capital have changed over time. But focusing on how a society moves from one level of social capital to another over time requires better macro level measures.Better measures are required to test even basic hypotheses such as the establishing the direction of causality between the two components of social capital. In the following analysis, I develop macro measures of social capital through the development of longitudinal measures of civic engagement and interpersonal trust. I,then, use these measures to test a basic assumption about social capital. I, first, perform a direction of causality test to substantiate the causal direction between the two components of social capital. Second, I model civic engagement as a function of the time and monetary-related resources required for civic participation and interpersonal trust as a function of long term trends in civic engagement and a set of controls for collective experiences. The result is more than just the ¯rst over time measures of social capital, but also an increase in our understanding of social capital as a macro process with complex causes and effects.
    Keywords: Social capital, social networks, trust
    JEL: P Q Z
    Date: 2005–11–03
  4. By: Thomas I Palley; Robert M. LaJeunesse
    Abstract: Much has been written about union wage bargaining. Much less has been written about union density, which has been viewed as simply the employment outcome under the wage bargain. This paper presents a new dynamic model of union density that exhibits multiple equilibria and path-dependency. The model builds upon Freeman (1998) who identified the importance of union spending on organizing and business spending on opposing unions. It emphasizes the demand for union representation which depends on wage bargaining outcomes, the state of labor law, and socio-economic factors impacting public attitudes to unions. The model is used to provide a narrative account of the historical evolution of union density in the U.S. and to identify factors important for its future evolution.
    Date: 2005
  5. By: Christopher Udry (Economic Growth Center, Yale University); Timothy G. Conley
    Abstract: In this chapter we examine social networks among farmers in a developing country. We use detailed data on economic activities and social interactions between people living in four study villages in Ghana. It is clear that economic development in this region is being shaped by the networks of information, capital and influence that permeate these communities. This chapter explores the determinants of these important economic networks. We first describe the patterns of information, capital, labor and land transaction connections that are apparent in these villages. We then discuss the interconnections between the various economic networks. We relate the functional economic networks to more fundamental social relationships between people in a reduced form analysis. Finally, we propose an equilibrium model of multi-dimensional network formation that can provide a foundation for further data collection and empirical research.
    Keywords: Endogenous Networks, Informal Credit, Social Learning
    JEL: O12 D85
    Date: 2004–05
  6. By: Herman Rosa; Deborah Barry; Susan Kandel; Leopoldo Dimas
    Abstract: In principle, payments for environmental services – such as watershed management, biodiversity conservation, and carbon sequestration – can advance the goals of both environmental protection and poverty reduction. A review of recent initiatives in the Americas suggests, however, that this desirable combination is not automatic. If payments for environmental services (PES) schemes are to be an effective vehicle for strengthening livelihoods in poor rural communities, they must be designed with that objective firmly in mind. This paper draws key lessons from diverse experiences in Costa Rica, Mexico, Brazil, El Salvador, and New York.
    Date: 2004
  7. By: Ioan Talpos (West University of Timisoara); Bogdan Dima (West University of Timisoara); Cosmin Enache (West University of Timisoara); Mihai Ioan Mutascu (West University of Timisoara)
    Abstract: The way in which the social subjects take decisions, the interactions established between these, the web of social institutions and rules, the architecture of the power relationships between the various “points of social coagulation” have as a foundation a complex set of determinants, in which the “pure” economic factors have an important, but not unique role. Thus, this paper intends to draft a possible analytical framework, capable of allowing the stress of some existing connections between the cultural variables, the social actions and the role of the public power. Heavy indebted to OLSON and NOZICK, the starting point is made out by a version of the mandate theory, within the way in which society, as a whole, as well as its individual components, delegates a certain set of social responsibilities to the public authorities, based on some social utility functions, which include the characteristics of the dominant cultural model. Part I of the paper deals with the elements of the theoretical foundation, elements resumed by a set of critical postulates and a special definition of state as the dominant agency in a social space and also of the negotiation/parallel associations. Part II is an attempt to examine some empirical evidences in the favor of some results derived from this foundation. The main conclusion of the paper could be resumed by the idea that trying to describe the interactions between state and society without taking into the account the characteristics of the cultural paradigm is equivalent to talk about Hamlet without mentioning the prince of Denmark.
    Keywords: agency, negotiation/parallel associations, cultural paradigm
    JEL: D6 D7 H
    Date: 2005–10–30
  8. By: Stephen Calabrese; Dennis Epple; Thomas Romer; Holger Sieg
    Abstract: Few empirical strategies have been developed that investigate public provision under majority rule while taking explicit account of the constraints implied by mobility of households. The goal of this paper is to improve our understanding of voting in local communities when neighborhood quality depends on peer or neighborhood effects. We develop a new empirical approach which allows us to impose all restrictions that arise from locational equilibrium models with myopic voting simultaneously on the data generating process. We can then analyze how close myopic models come in replicating the main regularities about expenditures, taxes, sorting by income and housing observed in the data. We find that a myopic voting model that incorporates peer effects fits all dimensions of the data reasonably well.
    JEL: H4 H7 H1 R5
    Date: 2005–10
  9. By: Adelina Gschwandtner; Michael A. Hauser
    Abstract: The dynamic structure of profit rates for 156 US manufacturing companies is analyzed by means of fractional integration techniques as an alternative to the commolny used ARMIA models with respect to the "persistence of profits". The results show - despite the short lengths of the series - that 35,5% of the series have long range dependence and 54% are nonstationary. This is a confirmation of the strong challenge to the competitive environment hypothesis obtained by previous studies.
    JEL: L00 C22
    Date: 2005–07
  10. By: Facundo Albornoz and Paolo Vanin
    Abstract: In a small open economy with heterogeneous firms, in which tariffs determine the mass of active firms, free trade optimality depends positively on the level of firm heterogeneity and negatively on transportation costs. The benefits from temporary protection depend on the level of backwardness: for a given mass of backward firms, the relative gains from protection increase with their quality and decrease with the quality of advanced firms; for given production quality levels, the relative advantage of protection increases with the mass of backward firms.
    Keywords: Production network, Learning externalities, Infant industry
    JEL: D51 D62 F12 F13
    Date: 2005–09
  11. By: Roberta Sisto; Antonio Lopolito; Gianluca Nardone
    Date: 2005–10
    Abstract: La investigación del capital social en Colombia se ha circunscrito al estudio de los hogares y las comunidades dentro de las ciudades, desde la perspectiva de la antropología y la sociología. Dichas disciplinas han investigado las interacciones entre actores individuales y cómo éstas permiten alcanzar beneficios, tales como la provisión de redes de protección o la suavización del consumo. En la economía se han realizado pocos estudios microeconómicos al respecto, a pesar de que el capital social puede ser un determinante de los ingresos de los hogares. Este documento discute y explica la relación entre el capital social y el ingreso de los hogares urbanos en Colombia. El objetivo del trabajo es consolidar un marco teórico que desarrolla el concepto de capital social en la economía. El modelo teórico planteado concluye que el efecto del capital social sobre el nivel de ingreso es positivo y se trasmite a través de un multiplicador del stock de capital humano. En el análisis empírico, el capital social se mide como la densidad de las asociaciones horizontales y verticales. Dada la relación de doble causalidad entre el ingreso y el capital social, se utiliza el método de variables instrumentales para estimar los determinantes del capital social y el efecto de éste sobre el ingreso. Los resultados sugieren que el capital social de los hogares afecta positivamente su nivel de ingreso e identifica los determinantes del capital social en Colombia.
    Keywords: Capital social
    JEL: D10
    Date: 2005–08–20
  13. By: Eric Bettinger; Robert Slonim
    Abstract: Economic research examining how educational intervention programs affect primary and secondary schooling focuses largely on test scores although the interventions can affect many other outcomes. This paper examines how an educational intervention, a voucher program, affected students' altruism. The voucher program used a lottery to allocate scholarships among low-income applicant families with children in K-8th grade. By exploiting the lottery to identify the voucher effects, and using experimental economic methods, we measure the effects of the intervention on children's altruism. We also measure the voucher program's effects on parents' altruism and several academic outcomes including test scores. We find that the educational intervention positively affects students' altruism towards charitable organizations but not towards their peers. We fail to find statistically significant effects of the vouchers on parents' altruism or test scores.
    JEL: I2 C9
    Date: 2005–10
  14. By: Alois Sutzer (University of Zurich and IZA Bonn); Bruno S. Frey (University of Zurich)
    Abstract: This paper analyzes the causal relationships between marriage and subjective well-being in a longitudinal data set spanning 17 years. We find evidence that happier singles opt more likely for marriage and that there are large differences in the benefits from marriage between couples. Potential, as well as actual, division of labor seems to contribute to spouses’ wellbeing, especially for women and when there is a young family to raise. In contrast, large differences in the partners’ educational level have a negative effect on experienced life satisfaction.
    Keywords: division of labor, marriage, selection, subjective well-being
    JEL: D13 I31 J12
    Date: 2005–10
  15. By: Evelyn L. Lehrer (University of Illinois at Chicago and IZA Bonn)
    Abstract: The far-reaching consequences of failing to complete secondary schooling are well known. The central questions addressed in this study are: Does religion make a difference in the likelihood of successfully completing the transition to high-school graduation? If so, how large are the influences? Based on a human capital framework, the paper develops hypotheses about the effects of two dimensions of religion during childhood - affiliation and participation - and tests them with data on non-Hispanic white, African-American, and Hispanic female respondents from the 1995 National Survey of Family Growth. The results are generally consistent with the hypotheses, revealing sizeable differentials in high-school graduation rates by affiliation and participation. The results also uncover pronounced differences by race/ ethnicity.
    Keywords: religion, education
    JEL: J24 J15 J22
    Date: 2005–10
  16. By: Brice Fallick; Charles A. Fleischmann; James A. Rebitzer
    Abstract: In Silicon Valley's computer cluster, skilled employees are reported to move rapidly between competing firms. This job-hopping facilitates the reallocation of resources towards firms with superior innovations, but it also creates human capital externalities that reduce incentives to invest in new knowledge. Using a formal model of innovation we identify conditions where the innovation benefits of job-hopping exceed the costs from reduced incentives to invest in human capital. These conditions likely hold for computers, but not in most other settings. Features of state law also favor high rates of inter-firm mobility in California. Outside of California, employers can use non-compete agreements to inhibit mobility, but these agreements are unenforceable in California. Using new data on labor mobility we find higher rates of job-hopping for college-educated men in Silicon Valley's computer industry than in computer clusters located out of the state. Mobility rates in other California computer clusters are similar to Silicon Valley's, suggesting some role for state laws restricting non-compete agreements. Consistent with our model of innovation, we also find that outside of the computer industry, California's mobility rates are no higher than elsewhere.
    JEL: R12 L63 O3 J63 J48
    Date: 2005–10
  17. By: John S. Heywood (University of Wisconsin); W.S. Siebert (University of Birmingham Business School and IZA Bonn); Xiangdong Wei (Lingnan University, Hong Kong)
    Abstract: High performance workplaces elicit greater involvement and productivity from employees but past theory and evidence remain divided on whether or not such workplaces are compatible with family friendly work practices. We present new evidence on the association using perceptions of a representative sample of workers and an innovative testing framework. The evidence reveals that high performance workplaces are no more likely to make commitments to provide family friendly workplaces than are other workplaces. It shows, however, that high performance workplaces are more likely to keep the family friendly commitments they make, thereby maintaining a "psychological contract" based on mutual obligation. As providing family friendly practices requires both making and keeping commitments, the evidence confirms that high performance workplaces are more likely to provide such practices.
    Keywords: high performance workplaces, family friendly practices, motivation, work incentives
    JEL: J31 J32 J81
    Date: 2005–10
  18. By: Chris van Klaveren (Faculty of Economics and Econometrics, Universiteit van Amsterdam); Henriëtte Maassen van den Brink (Faculty of Economics and Econometrics, Universiteit van Amsterdam)
    Abstract: If partners derive utility from joint leisure time, it is expected that they will coordinate their work schedules in order to increase the amount of joint leisure. In order to control for differences in constraints and selection effects, this paper uses a new matching procedure, providing answers to the following questions: (1) Do partners coordinate their work schedules and does this result in work time synchronization?; (2) which partners synchronize more work hours?; and (3) is there a preference for togetherness? We find that coordination results in more synchronized work hours. The presence of children in the household is the main cause why some partners synchronize their work times less than other partners. Finally, partners coordinate their work schedules in order to have more joint leisure time, which is evidence for togetherness preferences.
    Keywords: Time Allocation; Leisure Time; Togetherness; Work Hours
    JEL: D13 I31 J12 J22
    Date: 2005–10–19
  19. By: Alessandro Magnoli (Harvard University)
    Abstract: According to conventional wisdom, health and education are important factors for economic and social development: they improve productivity and income distribution, and the poor gain the most. Nonetheless, in many regions of the world not all members of society receive these services equally. To a large extent, women are left out of health and education systems; as a consequence, they constitute an economically and socially disadvantaged group. Disproportionate poverty, low social status, and their reproductive role expose women to high health risks, resulting in needless and largely preventable suffering and death. A woman’s health and nutritional status is not only an individual welfare concern, but also a national one, because it has an impact on her children and her economic productivity. Similarly, women’s education still lags far behind men’s in most developing countries, with far- reaching adverse consequences for both the individual and national well being. Indeed, more schooling increases the incomes of males and females, but educating girls generates much larger social benefits. Why? Because women will use both the newly acquired knowledge and related extra income for the benefit of the family. This article analyzes the gender gaps within health and education in six regions of the developing world: Sub-Saharan Africa; South Asia; East and Southeast Asia; The Middle East and North Africa; Latin America and the Caribbean; Eastern Europe and Central Asia. In all of these regions, there is an unfinished agenda in terms of access and equity. Three substantial reasons support an active government interest in the field of women’s health and nutrition and justify public expenditure in gender-targeted educational policies: equity, economic development and social cohesion. On the one hand, investment in women’s health and nutrition promotes equality, widespread benefits for this generation and the next, and economic efficiency because many of the interventions that address women’s health problems are cost-effective. On the other hand, educating women brings about the potential benefit of educating the population. The failure to educate women can result in the loss of raised productivity, increased income, and improved quality of life. In general, the exclusion of women from health and education delivery can act as a severe constraint on the achievement of higher development levels. Hence, it is a high priority to invest more in these social services and to remodel their delivery systems.
    Keywords: Gender Gap; Health and education
    JEL: J
    Date: 2005–10–28
  20. By: Andrew Grodner (Center for Policy Research, Maxwell School, Syracuse University); Thomas Kniesner (Center for Policy Research, Maxwell School, Syracuse University)
    Abstract: Our research econometrically tests the presence of social interactions in the labor supply model. The interdependence is defined as a response of individual's hours worked to the mean hours worked in one's reference group. The reference group includes individuals who share similar age, family structures, and location, all of which jointly determine the economic distance that reflects the cost of interactions. We identify an endogenous social interactions effect by instrumenting for the variable representing the mean hours worked of the people in an individual's reference group with the mean hours worked of the individuals in the adjacent reference groups. Estimates of the linear labor supply model proposed in the literature using Panel Study of Income Dynamics data indicate the presence of positive and non-negligible spillovers in hours worked. The total wage elasticity of labor supply os 0.22, where 0.08 is due to the exogenous wage change, and 0.14 is due to social interactions.
    JEL: J22
    Date: 2005–09
  21. By: Antoine Martin; Michael J. Orlando
    Abstract: We examine incentives for network-specific investment and the implications for network governance. We model an environment in which participants that make payments over a network can invest in a technology that reduces the marginal cost of using the network. A network effect results in multiple equilibria; either all agents invest and network usage is high or no agents invest and network usage is low. When commitment is feasible, the high-use equilibrium can be implemented; however, when commitment is infeasible, fixed costs associated with use of the network-specific technology result in a holdup problem that implements the low-investment equilibrium. Thus, governance structures necessary to achieve commitment will be preferred to those necessary merely to achieve coordination. For example, mutual ownership by network users may emerge where users face risk of ex post renegotiation. Such a governance structure will also be sufficient to avoid the network effect.
    Keywords: Investments ; Equilibrium (Economics) ; Payment systems
    Date: 2005
  22. By: Daniel S. Hamermesh (University of Texas at Austin NBER and IZA Bonn); Jungmin Lee (University of Arkansas-Fayetteville and IZA Bonn)
    Abstract: Social commentators have pointed to problems of workers who face "time stress" - an absence of sufficient time to accomplish all their tasks. An economic theory views time stress as reflecting how tightly the time constraint binds households. Time stress will be more prevalent in households with higher full earnings and whose members work longer in the market or on "required" homework. Evidence from Australia (2001), Germany (2002), the United States (2003) and Korea (1999) corroborates the theory. Adults in households with higher earnings perceive more time stress for the same amount of time spent in market work and household work. The importance of higher full earnings in generating time stress is not small, particularly in U.S. - much is "yuppie kvetch."
    Keywords: time stress, household production, feeling rushed
    JEL: J22
    Date: 2005–10

This nep-soc issue is ©2005 by Fabio Sabatini. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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