nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2006‒02‒26
eighteen papers chosen by
Fabio Sabatini
Universita degli Studi di Roma, La Sapienza

  1. People People: Social Capital and the Labor-Market Outcomes of Underrepresented Groups By Lex Borghans; Bas ter Weel; Bruce A. Weinberg
  2. Banking with sentiments. A model of fiduciary interactions in micro-credit programs By Vittorio Pelligra
  3. A Model of Income Insurance and Social Norms By Lindbeck, Assar; Persson, Mats
  4. Is group affiliation profitable in developed countries? Not in Belgium By Buysschaert A.; Deloof M.; Jegers M.
  6. Parallel lives? Ethnic segregation in schools and neighbourhoods By Simon Burgess; Ruth Lupton; Deborah Wilson
  7. Need for closure, gender and social self-esteem of youngsters By Vermeir, I.; Geuens, M.
  8. Strategic Marketing Alliances, Partnerships and Networks – The Logic of Cooperation, Roots, Evolution and Advantage By Oburai Prathap; Baker Michael J
  9. How's Your Government? International Evidence Linking Good Government and Well-Being By John F. Helliwell; Haifang Huang
  10. Conflict, Trust, and Effectiveness in Teams Performing Complex Tasks: A Study of Temporal Patterns By Raes Anneloes M.L.; Heijltjes Mariëlle G.; Glunk Ursula; Roe Robert A.
  11. Altruism and Gender in the Trust Game By Alessandro Innocenti; Maria Grazia pazienza
  12. Sorting in Experiments with Application to Social Preferences By Edward Lazear; Ulrike Malmendier; Roberto Weber
  13. The determinants of subjective poverty: A comparative analysis in Madagascar and Peru By Javier Herrera; Mireille Razafindrakoto; François Roubaud
  14. Parental Investment in Childhood and Later Adult Well-Being: Can More Involved Parents Offset the Effects of Socioeconomic Disadvantage? By Darcy Hango
  15. Social Segregation in Secondary Schools : How Does England Compare with Other Countries ? By Stephen P. Jenkins; John Micklewright; Sylke V. Schnepf
  16. Urban Social Exclusion in Transitional China By Bingqin Li
  17. Knowing what is good for you: Empirical analysis of personal preferences and the “objective good” By Orsolya Lelkes
  18. Gli effetti del capitale pubblico sulla produttivitá delle regioni italiane By Emanuela Marrocu; Raffaele Paci; Francesco Pigliaru

  1. By: Lex Borghans; Bas ter Weel; Bruce A. Weinberg
    Abstract: Despite indications that people skills are important for understanding individual labor-market outcomes and have become more important over the last decades, there is little analysis by economists. This paper shows that people skills are important determinants of labor-market outcomes, including occupations and wages. We show that technological and organizational changes have increased the importance of people skills in the workplace. We particularly focus on how the increased importance of people skills has affected the labor-market outcomes of under represented groups. We show that the acceleration rate of increase in the importance of people skills between the late 1970s and early 1990s can help explain why women’s wages increased more rapidly while the wages of blacks grew more slowly over these years relative to earlier years.
    JEL: J16 J21 J24 J31
    Date: 2006–01
  2. By: Vittorio Pelligra
    Abstract: The success of many micro-credit initiatives is difficult to account for in the traditional economic framework, where, mainly because of the assumption of self-interested behaviour, credit is rationed and provided only to those able to back it with collaterals. Having analysed different alternative explanations for such a success, the paper introduces the concept of trust responsiveness in the lender-borrower relationship and formalises it in a psychological game-theoretical model aimed at explaining the unusually high rate of repayment experienced in micro-credit programs. Three well-known psychological effects are introduced to discuss the factors that may positively or negatively affect borrowers’ trustworthiness. This model provides important normative implications for institutional design.
    Keywords: Microfinance; Trust responsiveness; Psychological Game Theory
    JEL: C72 O12
    Date: 2005
  3. By: Lindbeck, Assar (The Research Institute of Industrial Economics); Persson, Mats (Institute for International Economic Studies)
    Abstract: A large literature on ex ante moral hazard in income insurance emphasizes that the individual can affect the probability of an income loss by choice of lifestyle and hence, the degree of risk-taking. The much smaller literature on moral hazard ex post mainly analyzes how a “moral hazard constraint” can make the individual abstain from fraud (“mimicking”). The present paper instead presents a model of moral hazard ex post without a moral hazard constraint; the individual's ability and willing­ness to work is represented by a continuous stochastic variable in the utility function, and the extent of moral hazard depends on the generosity of the insurance system. Our model is also well suited for analyzing social norms concerning work and benefit dependency.
    Keywords: Moral Hazard; Sick Pay Insurance; Labor Supply; Asymmetric Information  
    JEL: G22 H53 I38 J21
    Date: 2006–01–25
  4. By: Buysschaert A.; Deloof M.; Jegers M.
    Abstract: Several studies find that business groups create value for affiliated companies in developing countries, which are characterized by weak institutions and poorly functioning markets. In these countries, business groups can act as an intermediary between imperfect markets and individual entrepreneurs. This raises the question whether business groups also create value in countries with strong institutions and well-functioning markets, as there are also substantial costs associated with business groups. We investigate the performance of group-affiliated companies in Belgium, and find that these companies significantly underperform compared to stand-alone companies. Moreover, our results suggest that internal capital markets in Belgian business groups result in misallocation of capital.
    Date: 2005–06
  5. By: Justina A.V. Fischer; Benno Torgler
    Abstract: behaviour is sorely lacking. Therefore, this paper assesses such positional impact on social capital by applying 14 different measurements to International Social Survey Programme data from 25 countries. We find support for a positional concern effect or 'envy' whose magnitude in several cases is quite substantial. The results indicate that such an effect is non-linear. In addition, we find an indication that absolute income level is also relevant. Lastly, changing the reference group (regional versus national) produces no significant differences in the results.
    Keywords: Relative income position, envy, positional concerns, social capital, social norms, happiness
    JEL: Z13 H26 I31 D00 D60
    Date: 2006–02
  6. By: Simon Burgess; Ruth Lupton; Deborah Wilson
    Abstract: We provide evidence on the extent of ethnic segregation experienced by children across secondary schools and neighbourhoods (wards). Using 2001 Schools Census and Population Census data we employ the indices of dissimilarity and isolation and compare patterns of segregation across nine ethnic groups, and across Local Education Authorities in England. Looking at both schools and neighbourhoods, we find high levels of segregation for the different groups, along with considerable variation across England. We find consistently higher segregation for South Asian pupils than for Black pupils. For most ethnic groups children are more segregated at school than in their neighbourhood. We analyse the relative degree of segregation and show that high population density is associated with high relative school segregation.
    Keywords: education, sorting
    JEL: J7 J16 J42
    Date: 2005–06
  7. By: Vermeir, I.; Geuens, M.
    Abstract: The present study focuses on social self-esteem of youngsters (i.e. esteem derived from approval of others), a widespread, important pursuit of youngsters in modern society. More specifically, we explored the relationship between social self-esteem on the one hand, and an individual difference measure, Need for Closure, and gender on the other hand. Results show that NFCL and gender significantly relate to social self-esteem values like eagerness for approval and tranquility, achievement pressure and competence orientation, individualism, independency and appearance mindedness. NFCL and gender also affect youngster’s social esteem related self-images. In addition, interesting interaction effects were identified. Limitations and directions for future research are suggested.
    Keywords: Need for Closure; Values; Self-Image, Gender, Social Self-Esteem
    Date: 2006–02–12
  8. By: Oburai Prathap; Baker Michael J
    Abstract: The marketing discipline is evolving and so is its agenda with the advent of relationship marketing, networks and other related sub-fields. Till recently, business literature focused largely on competition, and cooperation, its counter part, has received insufficient attention. With a view to redress the situation, this research article investigates the phenomenon of strategic marketing alliances, partnerships and networks, and aims to make fundamental theoretical contributions in the sub-field of business-to-business relations and cooperation. Eclectic and wide-ranging enquiry is a main research tool employed and hence the character of this research is interdisciplinary. An extensive literature review of a number of related disciplines is undertaken in order to capture the essence of cooperative strategies and implications for competitive advantage. In this paper, we examine the phenomenon of cooperation and its evolution over time, and highlight the advantages of cooperative strategies in the workplace and in economic organisation. Following an introductory section, we discuss in the second and third sections the evolution of cooperation and need for adaptation on the part entities in order to obtain favourable outcomes. Fourth section continues the discussion along the biological evolutionary lines and adds the crucial dimension of social organisation. Consequent changes that altered the ways in which societies and economies developed are captured in the fifth section. The final and concluding section is devoted to exploring avenues for building of theories that explain cooperative forms of organisation.
    Keywords: Business-Business Marketing, Marketing Strategy, Relationship Marketing
    Date: 2006–02–17
  9. By: John F. Helliwell; Haifang Huang
    Abstract: In this paper we employ World Values Survey measures of life satisfaction as though they were direct measures of utility, and use them to evaluate alternative features and forms of government in large international samples. We find that life satisfaction is more closely linked to several World Bank measures of the quality of government than to real per capita incomes, in simple correlations and more fully specified models explaining international differences in life satisfaction. We test for differences in the relative importance of different aspects of good government, and find a hierarchy of preferences that depends on the level of development. The ability of governments to provide a trustworthy environment, and to deliver services honestly and efficiently, appears to be of paramount importance for countries with worse governance and lower incomes. The balance changes once acceptable levels of efficiency, trust and incomes are achieved, when more value is attached to building and maintaining the institutions of electoral democracy.
    JEL: H11 I31 P52
    Date: 2006–01
  10. By: Raes Anneloes M.L.; Heijltjes Mariëlle G.; Glunk Ursula; Roe Robert A. (METEOR)
    Abstract: In this study we analyze the evolution of intra-team conflict and trust in teams that perform complex tasks. Using a longitudinal research design with six time intervals over a period of ten months, we collected data on 41 teams. Our findings suggest the existence of two distinct temporal patterns. One pattern develops in a stable manner and is characterized by high levels of trust and relatively low levels of task and relationship conflict. The other pattern is unstable with low, deteriorating levels of trust and high, amplifying levels of task and relationship conflict. These patterns are associated with significant differences in team effectiveness. On a self-perception as well as a stakeholder measure of team effectiveness, teams with stable patterns outperformed teams with unstable patterns.
    Keywords: management and organization theory ;
    Date: 2006
  11. By: Alessandro Innocenti; Maria Grazia pazienza
    Abstract: This paper analyses gender differences in the trust game. Our experiment implements the triadic design proposed by Cox (2004) to discriminate between transfers resulting from trust or trustworthiness and transfers resulting from altruistic preferences. We observe that women exhibit a higher degree of altruism than men for both trust and trustworthiness but relatively more for trustworthiness. This result provides an explanation to the experimental finding that women reciprocate more than men.
    Keywords: gender differences; trust; trustworthiness; altruism; gender pairing
    JEL: C90 C91 D64 J16
    Date: 2006–02
  12. By: Edward Lazear; Ulrike Malmendier; Roberto Weber
    Abstract: Experiments provide a controlled setting where factors can be isolated and studied more easily than in the field, but they often do not allow participants to sort into or out of environments based on their preferences, beliefs, and skills. We conduct an experiment to demonstrate the importance of sorting in the context of social preferences. When individuals are constrained to play a dictator game, 74% of the subjects share. But when subjects are allowed to avoid the situation altogether, less than one third share. This reversal of proportions illustrates that the influence of sorting limits the generalizability of experimental findings that do not allow sorting. Moreover, institutions designed to entice pro-social behavior may induce adverse selection. We find that increased payoffs prevent foremost those subjects from opting out who share the least initially. Thus the impact of social preferences remains much lower than in a mandatory dictator game, even if sharing is subsidized by higher payoffs. Our experiment also sheds light on the motives for sharing. While much sharing is consistent with other-regarding preferences, the majority of subjects share without really wanting to, as evidenced by their willingness to avoid the dictator game and to even pay for avoiding it.
    JEL: B41 C90 D64
    Date: 2006–02
  13. By: Javier Herrera (DIAL, IRD, Paris); Mireille Razafindrakoto (DIAL, IRD, Paris); François Roubaud (DIAL, IRD, Paris)
    Abstract: (english) The multidimensionality of poverty is now fully acknowledged. A number of studies show a weak correlation between the monetary approach to poverty and household's subjective perception of wellbeing. Recent studies in developed countries demonstrate that well-being is not only based on monetary income or consumption, but also on other factors such as employment and health. This paper examines the factors that determine households’ subjective evaluation of their living standards, through a comparative analysis in two developing countries, Peru and Madagascar. Our study is based on a first-hand database grouping objective individual variables (the households’ socio-economic characteristics, environment and individual trajectories, provided by the two surveys’ panel studies), and identical questions on subjective well-being for both countries. How much do income levels influence households' welfare perceptions? Do these depend on the level of income and/or the relative position with respect to a given reference group? Apart from income, does the type of labour market inclusion or job quality have a significant impact on subjective well-being? To what extent do individual trajectories and local environment affect well-being (social origin, spatial inequalities in the district)? Finally, how important are the new dimensions of poverty such as vulnerability and social and political exclusion? _________________________________ (français) Le caractère multidimensionnel de la pauvreté est aujourd'hui universellement reconnu. Un certain nombre d'études montrent une faible corrélation entre l'approche monétaire de la pauvreté et la perception des ménages de leur bien-être. Des travaux récents ont pu montrer que, dans les pays développés, cette dernière ne dépend pas seulement du niveau de revenu ou de consommation, mais aussi d'autres facteurs (emploi, santé, etc.). Cette contribution se propose d'explorer les facteurs qui déterminent l'évaluation subjective des ménages de leur niveau de vie à partir d'une analyse comparative portant sur deux pays en développement, le Pérou et Madagascar. Pour ce faire, l'étude mobilise une base de données originale, comptant à la fois des variables individuelles objectives (caractéristiques socio-économiques des ménages, environnement et trajectoires individuelles obtenues grâce à la dimension panel des deux enquêtes), ainsi que des mesures subjectives du bienêtre identiques pour les deux pays. Quelle est la contribution du revenu à la perception du bien-être ? Celle-ci dépend-elle du niveau de revenu et/ou de la position relative par rapport à un groupe de référence qu'il convient d'identifier ? Au-delà des revenus, le type d'insertion sur le marché du travail et la qualité de l’emploi ont-ils une influence significative sur le bien-être subjectif ? Dans quelle mesure la trajectoire d’un individu et son environnement immédiat jouent sur son bien-être (origine sociale, inégalités spatiales au niveau du quartier) ? Enfin, quel est le poids des nouvelles dimensions de la pauvreté telles que la vulnérabilité et l’exclusion sociale et politique ?
    Keywords: Subjective wellbeing, peer group effects, capacity to aspire, relative income, panel data Madagascar, Peru, Bien-être subjectif, pauvreté, groupes de comparaison, aspirations, revenu relatif, données de panel, Madagascar, Pérou.
    JEL: I31 I32 D60 C25
    Date: 2006–01
  14. By: Darcy Hango
    Abstract: Parental involvement in their children's lives can have a lasting impact on well-being. More involved parents convey to their children that they are interested in their development, and this in turn signals to the child that their future is valued. However, what happens in socio-economically disadvantaged homes? Can the social capital produced by greater parental involvement counteract some of the harmful effects of less financial capital? These questions are examined on the National Child Development Study; a longitudinal study of children born in Britain in 1958. Results on a sample of children raised in two parent families suggest that parental involvement does matter, but that it depends on when it and poverty are measured, as well as the type of involvement and the gender of the parent. Father interest in education has the strongest impact on earlier poverty, especially at age 11. Meanwhile, both father and mother interest in school at age 16 have the largest direct impact on education. The frequency of outings with mother at age 11 also has a larger direct impact on education than outings with father, however, neither compare with the reduction in the poverty effect as a result of father interest in school.
    Keywords: parental involvement, socioeconomic disadvantage, social capital, education, National Child Development Study
    JEL: I21 I32 J13 Z13
    Date: 2005–05
  15. By: Stephen P. Jenkins; John Micklewright; Sylke V. Schnepf
  16. By: Bingqin Li
    Abstract: This paper demonstrates that urban social exclusion in China does not only include restricted participation by the ¿underclass¿ in urban life, but also the deprivation of certain political, social and economic rights. In addition, the paper describes how the character of urban social exclusion has changed over time. The author also examines the social exclusion of rural workers living and working in urban areas. The paper concludes by arguing that urban social exclusion in China needs coordinated reforms that target the whole set of problems in the urban ¿underclass¿ lacking political rights, social protection and economic opportunities.
    Keywords: social exclusion, urban China, rural to urban migrants
    JEL: J43 R23 I30
    Date: 2004–03
  17. By: Orsolya Lelkes
    Abstract: This paper aims to test empirically if certain frequently used measures of well-being, which are regarded as valuable properties of human life, are actually desired by people. In other words, it investigates whether the "expert judgments" in social science overlap with social consensus on what the "good life" is. The starting hypothesis is that there is an overlap between these two in the case of basic needs. For the analysis, individuals' self-reported life satisfaction is used as a proxy for "utility", based on survey data, which includes about 30 000 individuals from 21 different European countries. The results indicate that the commonly used measures of well-being - labour market situation, health, housing conditions and social relations - significantly influence people's satisfaction, ceteris paribus. Next, the stability of preferences is tested using Hungarian data from the 1990s. The results indicate that there was only very limited change in the relationship between life satisfaction and basic measures of well-being despite the landslide of societal and economic transformation.
    Keywords: quality of life, capabilities, happiness, basic needs, economic transition
    JEL: D63 I31 P36
    Date: 2005–03
  18. By: Emanuela Marrocu; Raffaele Paci; Francesco Pigliaru
    Abstract: This paper investigates the role played by public capital in increasing the productivity levels in Italy. For the construction of the regional series for the public capital over the period 1996-2002, the study benefits from the use of the rich dataset on public expenditure, recently published by the Dipartimento per le Politiche di Sviluppo of the Italian Ministry of Economy and Finance. On the basis of estimated panel production functions the results point out that public capital has a positive and significant effect on production. Moreover, the effects of all production factors vary considerably between the Centre-Northern regions and the Southern regions of the country. In particular, while private capital is more effective in the South, public capital and labour exhibits elasticities much higher in the Centre-North with respect to the Mezzogiorno. The disaggregation of public capital in economic categories signals a significant different impact in the two macroareas. When the analysis is carried out by distinguishing among government levels it turns out that the decentralized administrative bodies are much less efficient in the South in delivering public expenditure.
    Keywords: public capital, production function, regional disparities, Italy
    JEL: C23 D24 O47
    Date: 2006

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