nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2007‒04‒09
sixteen papers chosen by
Fabio Sabatini
University of Rome, La Sapienza

  1. Education, social capital and entrepreneurial selection in Italy By Ferrante, Francesco; Sabatini, Fabio
  2. Social Norms and the Evolution of Conditional Cooperation By Spichtig, Mathias; Traxler, Christian
  3. Trust in International Organisations: An Empirical Investigation Focusing on the United Nations By Benno Torgler
  4. Gender bias in trustworthiness By Bonein, Aurélie; Serra, Daniel
  5. Multinationals in their communities: A social capital approach to corporate citizenship projects By Ian Jones; Michael Pollitt; David Bek
  6. Values, Beliefs and Development By Jeffry Jacob; Thomas Osang
  7. Personal Relations and their Effect on Behavior in an Organizational Setting: An Experimental Study By Jordi Brandts; Carles Solà
  8. The meritocracy as a mechanism to overcome social dilemmas By Gunnthorsdottir, Anna; Vragov, Roumen; Mccabe, Kevin
  9. Identification of Peer Effects through Social Networks By Yann Bramoullé; Habiba Djebbari; Bernard Fortin
  10. Segregation and Strategic Neighborhood Interaction By Jason Barr; Troy Tassier
  11. Voting in small networks with cross-pressure By Ascensión Andina-Díaz; Miguel A. Meléndez-Jiménez
  12. Social Interactions - Is There Really an Identification Problem? By v. Kalckreuth, Ulf
  13. Leadership and Overcoming Coordination Failure with Asymmetric Costs By Jordi Brandts; David J. Cooper; Enrique Fatas
  14. Total Work, Gender and Social Norms By Michael Burda; Daniel S. Hamermesh; Philippe Weil
  15. Trust Games Measure Trust By Daniel Houser; Daniel Schunk; Joachim Winter

  1. By: Ferrante, Francesco; Sabatini, Fabio
    Abstract: There is wide consensus that entrepreneurial talent is the ability to discover and exploit market opportunities by taking the relevant risky decisions. Discovery and exploitation are separate but interlinked features of entrepreneurship requiring, in different proportions, the exploitation of innate and acquired skills. Institutions and technology, by determining the nature of the discovery and exploitation process and the need for such skills, play an essential role in shaping the nature of entrepreneurial talent and the specific role of education in entrepreneurial selection and performance. Empirical studies on entrepreneurship do not offer a neat picture of the actual contribution of education to entrepreneurial human capital or entrepreneurial talent. This unsatisfactory outcome is not surprising and is due to an inadequate assessment of the context-dependent factors shaping the latter. Building on these premises, the aim of our research work is to carry out a in depth analysis of the determinants of entrepreneurship in Italy, thus accounting for the role that variables like the educational qualification, the family background, and social capital play in determining the entrepreneurial selection. This paper attempts to constitute a first step for the improvement of our understanding by means of a preliminary, exploratory, analysis on the Italian data and a series of probit analyses aimed at identifying the main determinants founding the entrepreneurial choice. Rough data are taken from an original dataset built by the authors partly drawing on the Survey of Household Income and Wealth (SHIW) carried out by the Bank of Italy. The latter has been integrated with a wide variety of environmental variables drawn from different data sources describing the social and institutional context of the entrepreneurial activity.
    Keywords: Education; Work status; Employment; Self-employment; Entrepreneurship; Human capital; Social capital; Cognitive abilities
    JEL: I21 M13 J24 J23 I2 Z13
    Date: 2007–01
  2. By: Spichtig, Mathias; Traxler, Christian
    Abstract: This paper develops a model of social norms and cooperation in large societies. Within this framework we use an indirect evolutionary approach to study the endogenous formation of preferences and the coevolution of norm compliance. Thereby we link the multiplicity of equilibria, which emerges in the presence of social norms, to the evolutionary analysis: Individuals face situations where many others cooperate as well as situations where a majority free-rides. The evolutionary adaptation to such heterogenous environments will favor conditional cooperators, who condition their pro-social behavior on the others' cooperation. As conditional cooperators react flexibly to their social environment, they dominate free-riders as well as unconditional cooperators.
    Keywords: Conditional Cooperation; Indirect Evolution; Social Norms; Heterogenous Environments
    JEL: C70 Z13
    Date: 2007–03
  3. By: Benno Torgler
    Abstract: The literature on social capital has strongly increased in the last two decades, but there still is a lack of substantial empirical evidence about the determinants of international trust. This empirical study analyses a cross-section of individuals, using micro-data from the World Values Survey, covering 38 countries, to investigate trust in international organizations, specifically in the United Nations. In line with previous studies on international trust we find that political trust matters. We also find that social trust is relevant, but contrary to previous studies the results are less robust. Moreover, the paper goes beyond previous studies investigating also the impact of geographic identification, corruption and globalization. We find that a higher level of (perceived) corruption reduces the trust in the UN in developed countries, but increases trust in developing and transition countries. A stronger identification with the world as a whole also leads to a higher trust in the UN and a stronger capacity to act globally in economic and political environment increases trust in the UN.
    Keywords: International Organizations, United Nations, International Trust, Political Trust, Social Trust, Corruption, Globalization.
    JEL: Z13 D73 O19
    Date: 2007–04–03
  4. By: Bonein, Aurélie; Serra, Daniel
    Abstract: Gender differences are often observed in real life-situations. We implement an experiment on the investment game which explores the influence of knowledge of partner's gender in trust and reciprocity by means of two treatments of information: the first one, without knowledge of partner's gender and the second treatment where gender's partner is common knowledge. A great heterogeneity of individuals’ behaviors is observed: from selfish behavior to complete trust and trustworthiness. Knowledge of responder’s gender does not imply different sending, even if men trust more their partners than women. However, a phenomenon of gender bias dominates in trustworthiness behavior.
    Keywords: investment game; experiment; trust; reciprocity; gender
    JEL: Z13 C91 C0 D69 J16
    Date: 2006–04
  5. By: Ian Jones; Michael Pollitt; David Bek
    Abstract: The objectives of this research are to provide new ways of thinking about and measuring the extent and effectiveness of multinational company efforts to contribute to society via their corporate citizenship (CC) (or corporate social responsibility - CSR) programmes. It uses as its method of analysis the emerging literature relating to the theory and measurement of social capital. The paper summarises the findings of a forthcoming book (from Palgrave, 2007). We begin by discussing the concept of corporate citizenship in the context of the multinational. We go on to introduce the concept of social capital employed in the study. Next we summarise our case study evidence with cases from Anglo American and Diageo. Following this, we review our statistical and econometric analysis which maps the community engagements of UK multinationals in South Africa, US multinationals in Mexico and EU multinationals in Poland. We demonstrate the usefulness for analysis of social capital thinking in this context and make suggestions for future work.
    Keywords: Social capital; Corporate citizenship; Corporate Social Responsibility; Multinational companies.
    JEL: M14 Z13
    Date: 2006–12
  6. By: Jeffry Jacob (St. John’s University); Thomas Osang (SMU)
    Abstract: This paper investigates the consequences of religion for economic development. In particular, we examine whether religious attitudes, beliefs, participation and preference contribute to differences in per capita income across countries. Using a large scale international survey on values and religious behavior, we estimate both cross-section and panel data models, controlling for the “deep determinants” of development: Institutions, geography and trade. Our results indicate that religion plays an important role in economic development, but mostly in a non-linear manner. Countries with moderate religious values and behavior tend to have higher income levels than countries on both ends of the religious spectrum.
    Keywords: Development, Economics of Religion, Institutions, Openness, Geography
    JEL: O1 Z12 N1 H1 F1
    Date: 2007–03
  7. By: Jordi Brandts; Carles Solà
    Abstract: We study how personal relations affect performance in organizations. In the experimental game we use a manager has to assign different degrees of decision power to two employees. These two employees then have to make distributive decisions which affect themselves and the manager. Our focus is on the effects on managers' assignment of decision power and on employees' distributive decisions of one of the employees and the manager knowing each other personally. Our evidence shows that managers tend to favor employees that they personally know and that these employees tend, more than other employees, to favor the manager in their distributive decisions. However, this behavior does not affect the performance of the employees that do not know the manager. All these effects are independent of whether the employees that know the manager are more or less productive than those who do not know the manager. The results shed light on discrimination and nepotism and its consequences for the performance of family firms and other organizations.
    Keywords: Family firms, nepotism, corporate governance, procedural fairness, experiments
    JEL: C92 D23 M50
    Date: 2006–12–01
  8. By: Gunnthorsdottir, Anna; Vragov, Roumen; Mccabe, Kevin
    Abstract: A new mechanism that substantially mitigates social dilemmas is examined theoretically and experimentally. It resembles the voluntary contribution mechanism (VCM) except that in each decision round subjects are ranked and then grouped according to their public contribution. The game has multiple mostly asymmetric, Pareto-ranked pure-strategy equilibria which are rather counterintuitive, yet experimental subjects tacitly coordinate the payoff-dominant equilibrium reliably and quite precisely. In the VCM grouping is random which, with its arbitrary relation to contribution corresponds to any grouping unrelated to output, for example grouping based on race or gender. The new mechanism resembles a meritocracy since based on how much they contribute; participants are assigned to strata that vary in payoff. The findings shed light on the nature of merit-based social and organizational grouping and provide guidelines for future research and application.
    Keywords: social dilemmas; Nash equilibrium; non-cooperative games; coordination; mechanism design; experiment
    JEL: D7
    Date: 2007–02–10
  9. By: Yann Bramoullé; Habiba Djebbari; Bernard Fortin
    Abstract: We provide new results regarding the identification of peer effects. We consider an extended version of the linear-in-means model where each individual has his own specific reference group. Interactions are thus structured through a social network. We assume that correlated unobservables are either absent, or treated as fixed effects at the component level. In both cases, we provide easy-to-check necessary and sufficient conditions for identification. We show that endogenous and exogenous effects are generally identified under network interaction, although identification may fail for some particular structures. Monte Carlo simulations provide an analysis of the effects of some crucial characteristics of a network (i.e., density, intransitivity) on the estimates of social effects. Our approach generalizes a number of previous results due to Manski (1993), Moffitt (2001), and Lee (2006).
    Keywords: Social networks, Peer effects, identification, reflection problem
    JEL: D85 L14 Z13 C3
    Date: 2007
  10. By: Jason Barr; Troy Tassier
    Abstract: We introduce social interactions into the Schelling model of residential choice. These social interactions take the form of a Prisoner's Dilemma game played with neighbors. First, we study the Schelling model over a wide range of utility functions and then proceed to study a spatial Prisoner's Dilemma model. These models provide a benchmark for studying a combined model with preferences over like-typed neighbors and payoffs in the spatial Prisoner's Dilemma game. We study this combined model both analytically and using agent-based simulations. We find that the presence of these additional social interactions may increase or decrease segregation compared to the standard Schelling model. If the social interactions result in cooperation then segregation is reduced, otherwise it is increased.
    Keywords: Schelling Tipping Model, Spatial Prisoner's Dilemma, Cooperation, Segregation
    JEL: C63 C73 D62
    Date: 2007–04
  11. By: Ascensión Andina-Díaz; Miguel A. Meléndez-Jiménez
    Abstract: We present a model of participation in elections in small networks, in which citizens su¤er from cross-pressures if voting against the alternative preferred by some of their social contacts. We analyze how the existence of cross-pressures may shape voting decisions, and so, political outcomes; and how candidates may exploit this e¤ect to their interest.
    Keywords: Network; Voting; Cross-Cutting.
    JEL: D72
  12. By: v. Kalckreuth, Ulf (Institut für Volkswirtschaft und Statistik (IVS))
    Abstract: Social interactions between individuals are central to modern economic theory as represented by works such as Durlauf (1996), Bénabou (1996a, 1996b) or Borjas (1992, 1995), that explain growth and income distribution jointly. This essay examines the radic
  13. By: Jordi Brandts; David J. Cooper; Enrique Fatas
    Abstract: We study how the heterogeneity of agents affects the extent to which changes in financial incentives can pull a group out of a situation of coordination failure. We focus on the connections between cost asymmetries and leadership. Experimental subjects interact in groups of four in a series of weak-link games. The treatment variable is the distribution of high and low effort cost across subjects. We present data for one, two and three low-cost subjects as well as control sessions with symmetric costs. The overall pattern of coordination improvement is common across treatments. Early coordination improvements depend on the distribution of high and low effort costs across subjects, but these differences disappear with time. We find that initial leadership in overcoming coordination failure is not driven by low-cost subjects but by subjects with the most frequent cost. This conformity effect can be due to a kind of group identity or to the cognitive simplicity of acting with identical others.
    Keywords: Experiments, Coordination, Organizational change, Heterogeneous agents, Leadership
    JEL: C70 C90 D63 D64
    Date: 2006–05–12
  14. By: Michael Burda; Daniel S. Hamermesh; Philippe Weil
    Abstract: Using time-diary data from 25 countries, we demonstrate that there is a negative relationship between real GDP per capita and the female-male difference in total work time per day -- the sum of work for pay and work at home. In rich northern countries on four continents, including the United States, there is no difference -- men and women do the same amount of total work. This latter fact has been presented before by several sociologists for a few rich countries; but our survey results show that labor economists, macroeconomists, the general public and sociologists are unaware of it and instead believe that women perform more total work. The facts do not arise from gender differences in the price of time (as measured by market wages), as women's total work is further below men's where their relative wages are lower. Additional tests using U.S. and German data show that they do not arise from differences in marital bargaining, as gender equality is not associated with marital status; nor do they stem from family norms, since most of the variance in the gender total work difference is due to within-couple differences. We offer a theory of social norms to explain the facts. The social-norm explanation is better able to account for within-education group and within-region gender differences in total work being smaller than inter-group differences. It is consistent with evidence using the World Values Surveys that female total work is relatively greater than men's where both men and women believe that scarce jobs should be offered to men first.
    JEL: D13 J16 J22
    Date: 2007–03
  15. By: Daniel Houser; Daniel Schunk; Joachim Winter (Mannheim Research Institute for the Economics of Aging (MEA))
    Abstract: The relationship between trust and risk is a topic of enduring interest. Although there are substantial differences between the ideas the terms express, many researchers from different disciplines have pointed out that these two concepts become very closely related in personal exchange contexts. This raises the important practical concern over whether behaviors in the widely-used “trust game” actually measure trust, or instead reveal more about risk attitudes. It is critical to confront this question rigorously, as data from these games are increasingly used to support conclusions from a wide variety of fields including macroeconomic development, social psychology and cultural anthropology. The aim of this paper is to provide cogent evidence on the relationship between trust and risk in “trust” games. Subjects in our experiment participate either in a trust game or in its risk game counterpart. In the trust version, subjects play a standard trust game and know their counterparts are human. In the risk version, subjects know their counterparts are computers making random decisions. We compare decisions between these treatments, and also correlate behavior with subjects’ risk attitudes as measured by the Holt and Laury (2002) risk instrument. We provide evidence that trusting behavior is different than behavior under risk. In particular, (i) decisions patterns in our trust and risk games are significantly different; and (ii) risk attitudes predict decisions in the risk game, but not the trust game.
    Date: 2006–12–31
  16. By: Anneli Kaasa
    Abstract: This paper investigates how different dimensions of social capital influence innovation output. The novelty of the paper lies in the fact that for measuring social capital, instead of one overall index, six factors are constructed of 20 indicators using principal components analysis. Then, human capital and R&D are also included in the analysis as factors of innovation. Unlike many previous studies, this one uses the structural equation modelling approach instead of regression analysis in order to take into account the relationships between the factors of innovation. Regional-level data from Eurostat Regio and the European Social Survey are analysed. Compared to preceding studies, a larger number of observations is used. The findings provide strong support for the argument that social capital indeed influences innovative activity and furthermore, that different dimensions of social capital have dissimilar effects on innovation.
    Keywords: innovation, social capital, human capital, R&D
    Date: 2007

This nep-soc issue is ©2007 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.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.