nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2009‒04‒05
eight papers chosen by
Fabio Sabatini
University of Siena

  1. Revisiting Strategic versus Non-strategic Cooperation By Reuben, E.; Suetens, S.
  2. Simplistic vs. Complex Organization: Markets, Hierarchies, and Networks in an 'Organizational Triangle' By Elsner, Wolfram; Hocker, Gero; Schwardt, Henning
  3. Religion, Clubs, and Emergent Social Divides By Makowsky, Michael
  4. Trading Trust - Post-Aristocratic Finance in the City of Stockholm By Norberg, Peter
  5. Towards an understanding of the endogenous nature of identity in games By Bezrukova, Katerina; Smith, John
  6. Contractually stable networks By CAULIER, Jean-Franois; MAULEON, Ana; VANNETELBOSCH, Vincent
  7. Vote-Buying and Reciprocity By Frederico Finan
  8. What explains attitudes toward prostitution? By Jakobsson, Niklas; Kotsadam, Andreas

  1. By: Reuben, E.; Suetens, S. (Tilburg University, Center for Economic Research)
    Abstract: We use a novel experimental design to disentangle strategically- and non-strategically-motivated cooperation. By using contingent responses in a repeated sequential prisoners’ dilemma with a known probabilistic end, we differentiate end-game behavior from continuation behavior within individuals while controlling for expectations. This design allows us to determine the extent to which strategically-cooperating individuals are responsible for the so-called endgame effect. Experiments with two different subject pools indicate that the most common motive for cooperation in repeated games is strategic and that the extent to which endgame effects are driven by strategically-cooperating individuals depends on the profitability of cooperation.
    Keywords: reputation building;strong reciprocity;conditional cooperation;strategic cooperation
    JEL: C91 D01 D74
    Date: 2009
  2. By: Elsner, Wolfram; Hocker, Gero; Schwardt, Henning
    Abstract: Transaction cost economics explains organizations in a simplistic ‘market-vs.-hierarchy’ dichotomy. In this view, complex real-world coordination forms are simply considered ‘hybrids’ of those ‘pure’ and ideal forms, thus being located on a one-dimensional ‘line’ between them. This ‘organizational dichotomy’ is mainly based on relative marginal transaction costs, relative lengths of value-added chains, and ‘rational choice’ of coordination form. The present paper, in contrast, argues that pure ‘market’ and ‘hierarchy’, even including their potential hybrids, are a theoretically untenable and empirically void set. Coordination forms, it is argued, have to be conceptualized in a fundamentally different way. A relevant ‘organizational space’ must reflect the dimensions of a complex world such as dilemma-prone direct interdependence, resulting in strong strategic uncertainty, mutual externalities, collectivities, and subsequent emergent process. This, in turn, will lead either to (1) informally institutionalized, problem-solving cooperation (the instrumental dimension of the institution) or (2) mutual blockage, lock-in on an inferior path, or power- and status-based market and hierarchy failure (the ceremonial dimension of the institution). This paper establishes emergent instrumental institutionalized cooperation as a genuine organizational dimension which generates a third ‘attractor’ besides ‘market’ and ‘hierarchy’, i.e., informal network. In this way, an ‘organizational triangle’ can be generated which may serve as a more relevant heuristic device for empirical organizational research. Its ideal corners and some ideal hybrids on its edges (such as ideal clusters and ideal hub&spoke networks) still remain empirically void, but its inner space becomes empirically relevant and accessible. The ‘Organizational Triangle’ is tentatively applied (besides casual reference to corporate behavior that has lead to the current financial meltdown), by way of a set of criteria for instrumental problem-solving and a simple formal algorithm, to the cases of the supplier network of ‘DaimlerChrysler US International’ at Tuscaloosa, AL, the open-source network Linux, and the web-platforms Wikipedia and ‘Open-Source Car’. It is considered to properly reflect what is generally theorized in evolutionary-institutional economics of organizations and the firm and might offer some insight for the coming industrial reconstructions of the car and other industries.
    Keywords: Market vs. Hierarchy; Transaction Costs; Complexity; Institutionalization; Network Formation; Hub&Spoke Supplier Networks; Open-Source Networks
    JEL: D23 L14 D85
    Date: 2009–03
  3. By: Makowsky, Michael
    Abstract: Arguments for and against the existence of an American cultural divide are frequently placed in a religious context. This paper seeks to establish that, all politics aside, the American religious divide is real, that modern religious polarization is not a uniquely American phenomenon, and that religious divides can be understood as naturally emergent within the club theory of religion. Analysis of the 2005 Baylor Religion reveals a bimodal distribution of religious commitment in the US. International survey data reveals bimodal distributions in twenty-eight of thirty surveyed countries. The club theory of religion, when applied in a multi-agent model, generates bimodal distributions of religious commitment whose emergence correlates to substitutability of club goods for standard goods and the mean population wage rate. Ramifications of religious bimodality include potential instability of majority rule electoral outcomes. Median estimators, such as majority rule democracy, are non-robust with bimodal distributions. When religion is politically salient and polarized, small errors can disproportionately shift the election result from the preferences of the median voter.
    Keywords: Culture Divide; Religious Divide; Club Theory; Multi-Agent Model; Sacrifice
    JEL: Z12 D71 C63
    Date: 2009–03–30
  4. By: Norberg, Peter (Dept. of Business Administration, Stockholm School of Economics)
    Abstract: <p> Purpose <p> The article aims to answer the question if particular values make for particular forms of trust. <p> Design/methodology/approach <p> In the present article, interviews and conversations the author has made with twenty-one employees in Swedish brokerage firms, merchant banks and mutual funds play the foremost empirical role. The informants range from stockbrokers, traders and market makers to managing directors of brokerage firms. <p> Findings <p> Trust is still important in the financial market, but researchers need to account for the new condition when finance means working with information technology and increasingly abstract instruments. Financial organizations are well described as networks while being informally structured, and characterised by an inward bonding that is cultural rather than formal. <p> The article argues that social bonding, building upon the values and ideology of employees replaces the class-based identification that has previously characterised the Stockholm financial market. With increasingly hedonist attitudes, employees in finance form a more fluent, neo-tribal sociality. Studying at a business school, and interacting socially at work forms values and constructs an elitist identity in finance. This type of sociality consists in sharing a lifestyle and having work identities that dominate their private identities. <p> Originality/value <p> The present piece of research views agents as driven by a plurality of motivations and rationalities.
    Keywords: neo-tribes; stockbrokers; financial networks; trust
    Date: 2009–04–02
  5. By: Bezrukova, Katerina; Smith, John
    Abstract: We test the assumption that preferences are unchanged throughout a strategic game in the absence of feedback. To do so, we study the relationship between the strategic nature of a game and players' identification in social groups. We present evidence that the strategic nature of the game affects the strength of identity. We also present evidence regarding the timing of the change in identity and what causes this change. In our experiment, the subjects play one of two versions of the Prisoner's Dilemma game where the attractiveness of the uncooperative action is manipulated. We refer to the version with a relatively attractive uncooperative action as the "Mean Game" and the other as the "Nice Game." We place each subject into one of two groups. Throughout the experimental procedure we measure identity, as standard in the psychology literature, in order to assess the extent to which subjects identify with their group. First, we find evidence of an interaction between the strategic nature of the game and the action selected in the game as affecting the identity of the subject. We find that in the Mean Game, there is little difference in the change in identification of those playing cooperatively against an ingroup member and those playing uncooperatively. However, in the Nice Game, those playing cooperatively against an ingroup member exhibit a significantly stronger change in identification than those playing uncooperatively. We find that the opposite is true for outgroup matches. Also, we show that the change in identity does not occur after initial inspection of the game but rather largely after the action choice has been made. Finally, we present evidence of an explanation of the effect: identity is enhanced by actions which are perceived to be less competitive and more cooperative.
    Keywords: Group Identity; Game Theory; Other-Regarding Preferences; Endogenous Preferences
    JEL: C70 Z13 C91
    Date: 2008–12–03
  6. By: CAULIER, Jean-Franois; MAULEON, Ana (UniversitŽ catholique de Louvain (UCL). Center for Operations Research and Econometrics (CORE)); VANNETELBOSCH, Vincent (UniversitŽ catholique de Louvain (UCL). Center for Operations Research and Econometrics (CORE))
    Abstract: We develop a theoretical framework that allows us to study which bilateral links and coalition structures are going to emerge at equilibrium. We define the notion of coalitional network to represent a network and a coalition structure, where the network specifies the nature of the relationship each individual has with his coalition members and with individuals outside his coalition. To predict the coalitional networks that are going to emerge at equilibrium we propose the concept of contractual stability which requires that any change made to the coalitional network needs the consent of both the deviating players and their original coalition partners. We show that there always exists a contractually stable coalitional network under the simple majority decision rule and the component-wise egalitarian or majoritarian allocation rules. Moreover, requiring the consent of group members may help to reconcile stability and efficiency.
    Keywords: networks, coalition structures, contractual stability, allocation rules.
    JEL: A14 C70
    Date: 2008–12
  7. By: Frederico Finan
    Abstract: In this paper, how social preferences overcome the commitment problems implicit in vote-buying is examined. Data used for the study is a survey information on vote-buying experienced in a 2006 municipal election in Paraguay, with information on behavior in experiments carried out in 2002. [Working Paper No. 214].
    Keywords: vote buying, elections, paraguay, data, reciprocity, politicians, politics, economists, economic behavior, social preferences, altruism,
    Date: 2009
  8. By: Jakobsson, Niklas (Department of Economics, School of Business, Economics and Law, Göteborg University); Kotsadam, Andreas (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: Using a larger and more representative sample than previous studies, we assess people’s attitudes toward prostitution in Norway and Sweden. Compared to previous statistical analyses in this field, the present study is the first to use sophisticated statistical methods that can shed further light on attitudes toward different aspects of prostitution while controlling for other confounding factors. The main findings are that men and sexual liberals are more positive toward prostitution, and that conservatives and those who support gender equality are more negative. Holding anti-immigration views is correlated with more positive attitudes toward buying, but not toward selling, sex. Norwegians are more positive than Swedes toward prostitution. It is also found that supporting gender equality has more explanatory power in Sweden than in Norway, and it is argued that this may be due to the more gendered nature of the Swedish debate.<p>
    Keywords: attitudes; norms; prostitution
    JEL: I28 J88 K14
    Date: 2009–03–26

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