nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2009‒06‒17
twelve papers chosen by
Fabio Sabatini
University of Siena

  1. Building Social Trust: A Human Capital Approach By Fali Huang
  2. To Trust or to Monitor: A Dynamic Analysis By Fali Huang
  3. Do Race and Fairness Matter in Generosity? Evidence from a Nationally Representative Charity Experiment By Christina M. Fong; Erzo F.P. Luttmer
  4. The Spatial Evolution of Innovation Networks: A Proximity Perspective By Ron Boschma; Koen Frenken
  5. "Caste and Wealth Inequality in India" By Ajit Zacharias; Vamsi Vakulabharanam
  6. Need I remind you? Monitoring with collective memory By David A. Miller; Kareen Rozen
  7. Innovation and Social Capital in the Small-Medium Enterprises: a case of bamboo handicraft in Indonesia By Brata, Aloysius Gunadi
  8. The Organization of Firms Across Countries By Nick Bloom; Raffaella Sadun; John Van Reenen
  9. Corporate Governance Networks in Turkey By Alper Duman; Efe Postalci
  10. Human and cultural capital complementarities and externalities in economic growth By Alberto BUCCI; Giovanna SEGRE
  11. Is Social Security Part of the Social Safety Net? By Jeffrey R. Brown; Julia Lynn Coronado; Don Fullerton
  12. Trends nelle media relations in Italia By Cinzia COLAPINTO

  1. By: Fali Huang (School of Economics, Singapore Management University)
    Abstract: Much evidence suggests individuals differ in their predisposition to cooperate, which is essentially a component of human capital. This paper examines the role of individual cooperative tendencies and their interactions with institutions in generating social trust; it also endogenizes cooperative tendencies using a human capital investment model. Multiple equilibria and ineffciencies exist due to positive externalities. An innovative fi?nding is that, when institutions are more e¤ective in punishing defecting behaviors, more people invest in cooperative tendencies and hence the endogenous social trust is higher, though the equilibrium cooperative tendencies are lower. This paper provides a plausible explanation for many empirical and experimental results
    JEL: Z13 J24
    Date: 2007–09
  2. By: Fali Huang (School of Economics, Singapore Management University)
    Abstract: In a principal?agent framework, principals can mitigate moral hazard problems not only through extrinsic incentives such as monitoring, but also through agents intrinsic trustworthiness. Their relative usage, however, changes over time and varies across societies. This paper attempts to explain this phenomenon by endogenizing agent trustworthiness as a response to potential returns. When monitoring becomes relatively cheaper over time, agents acquire lower trustworthiness, which may actually drive up the overall governance cost in society. Across societies, those giving employees lower weights in choosing governance methods tend to have higher monitoring intensities and lower trust. These results are consistent with the empirical evidence.
    Keywords: Monitoring , Trustworthiness , Trust , Screening , Economic Governance
    JEL: D2 J5 L2 M5 Z13
    Date: 2007–09
  3. By: Christina M. Fong; Erzo F.P. Luttmer
    Abstract: We present a dictator game experiment where the recipients are local charities that serve the poor. Donors consist of approximately 1000 participants from a nationally representative respondent panel that is maintained by a private survey research firm, Knowledge Networks. We randomly manipulate the perceived race and worthiness of the charity recipients by showing respondents an audiovisual presentation about the recipients. The experiment yields three main findings. First, we find significant racial bias in perceptions of worthiness: respondents rate recipients of their own racial group as more worthy. Second, respondents give significantly more when the recipients are described as more worthy. These findings may lead one to expect that respondents would also give more generously when shown pictures of recipients belonging to their own racial group. However, our third result shows that this is not the case; despite our successfully manipulating perceptions of race, giving does not respond significantly to recipient race. Thus, while our respondents do seem to rate ingroup members as more worthy, they appear to overcome this bias when it comes to giving.
    JEL: C93 D63 D64 H41 J71
    Date: 2009–06
  4. By: Ron Boschma; Koen Frenken
    Abstract: We propose an evolutionary perspective on the geography of network formation that is grounded in a dynamic proximity framework. In doing so, we root the proximity concept in an evolutionary approach to the geography of innovation networks. We discuss three topics. The first topic focuses on explaining the structure of networks. The second topic concentrates on explaining the effects of networks on the performance of actors. The third topic deals with the changing role of proximity dimensions in the formation and performance of innovation networks in the longer run.
    Keywords: evolutionary economic geography, knowledge networks, innovation networks, dynamic proximity
    JEL: R0 R1 R12
    Date: 2009–06
  5. By: Ajit Zacharias; Vamsi Vakulabharanam
    Abstract: In this paper, we conduct the novel exercise of analyzing the relationship between overall wealth inequality and caste divisions in India using nationally representative surveys on household wealth conducted during 1991–92 and 2002–03. According to our findings, the groups in India that are generally considered disadvantaged (known as Scheduled Castes or Scheduled Tribes) have, as one would expect, substantially lower wealth than the "forward" caste groups, while the Other Backward Classes and non-Hindus occupy positions in the middle. Using the ANOGI decomposition technique, we estimate that between-caste inequality accounted for about 13 percent of overall wealth inequality in 2002–03, in part due to the considerable heterogeneity within the broadly defined caste groups. The stratification parameters indicate that the forward caste Hindus overlap little with the other caste groups, while the latter have significantly higher degrees of overlap with one another and with the overall population. Using this method, we are also able to comment on the emergence and strengthening of a "creamy layer," or relatively well-off group, among the disadvantaged castes, especially the Scheduled Tribes.
    Date: 2009–05
  6. By: David A. Miller; Kareen Rozen
    Date: 2009–06–01
  7. By: Brata, Aloysius Gunadi
    Abstract: This paper aims to seek what type of innovation and to estimate the impact of social capital on the innovation in the small-medium enterprises (SMEs) in Indonesia. The data used in this paper was collected from May to June 2008 in several clusters of bamboo handicraft producers in the district of Sleman, Yogyakarta Special Province. The research found that more than half of respondents are innovative producers. Innovation of product and organizational are the important types of innovation in the bamboo handicraft. Social capital, measured by an index of trust significantly influences the innovation index. Other important variables that influence the index of innovation are location, sex, and education. However, in the logistic regression, only education that significantlly explain the probability of innovation.
    Keywords: innovation; social capital; trust; bamboo handicraft; Indonesia
    JEL: D13 L6 Z13 O31
    Date: 2009
  8. By: Nick Bloom; Raffaella Sadun; John Van Reenen
    Abstract: We argue that social capital as proxied by regional trust and the Rule of Law can improve aggregateproductivity through facilitating greater firm decentralization. We collect original data on the decentralization ofinvestment, hiring, production and sales decisions from Corporate Head Quarters to local plant managers inalmost 4,000 firms in the US, Europe and Asia. We find Anglo-Saxon and Northern European firms are muchmore decentralized than those from Southern Europe and Asia. Trust and the Rule of Law appear to facilitatedelegation by improving co-operation, even when we examine "bilateral trust" between the country of originand location for affiliates of multinational firms. We show that areas with higher trust and stronger rule of lawspecialize in industries that rely on decentralization and allow more efficient firms to grow in scale.Furthermore, even for firms of a given size and industry, trust and rule of law are associated with moredecentralization which fosters higher returns from information technology (we find IT is complementary withdecentralization). Finally, we find that non-hierarchical religions and product market competition are alsoassociated with more decentralization. Together these cultural, legal and economic factors account for fourfifthsof the cross-country variation in the decentralization of power within firms.
    Keywords: decentralization, trust, Rule of Law, social capital, theory of the firm
    JEL: L2 M2 O32 O33
    Date: 2009–06
  9. By: Alper Duman (Department of Economics, Izmir University of Economics); Efe Postalci (Department of Economics, Izmir University of Economics)
    Abstract: We provide an analysis of corporate governance networks implied by members of board of directors of 319 companies listed in Istanbul Stock Exchange (ISE) for the year 2007. Our configuration yields a bipartite network for which we provide small world statistics in addition to the usual measures commonly used in network analysis. We find that the networks have low density. However, within the giant component, the average path among agents is very low and the clustering coefficient is considerably high.
    Keywords: Corporate Governance, Networks
    JEL: D21 D85
    Date: 2009–05
  10. By: Alberto BUCCI; Giovanna SEGRE
    Abstract: The aim of this paper is to investigate the role of culture, viewed according to Throsby’s definition of cultural capital (that is, an asset of tangible and intangible cultural expressions), in fostering economic growth. Recent literature in the field of cultural economics highlights a possible inversion of the usual causality relation, and culture can be seen as one of the engine of economic wealth. In this article we analyze one possible channel through which it may occur: human capital investment. Using a two-sectors endogenous growth model, the relation between cultural and human capital is deeply investigated.
    Keywords: Economic growth, culture, human capital, complementarities, externalities
    JEL: O40 O41 Z10 J24
    Date: 2009–02–07
  11. By: Jeffrey R. Brown; Julia Lynn Coronado; Don Fullerton
    Abstract: Building on the existing literature that examines the extent of redistribution in the Social Security system as a whole, this paper focuses more specifically on how Social Security affects the poor. This question is important because a Social Security program that reduces overall inequality by redistributing from high income individuals to middle income individuals may do nothing to help the poor; conversely, a program that redistributes to the poor may nonetheless be regressive according to broader measures if it also redistributes from middle to upper income households. We have four major findings. First, as we expand the definition of income to use more comprehensive measures of well-being, we find that Social Security becomes less progressive. Indeed, when we use an "endowment" defined by potential labor earnings at the household level, rather than actual earnings at the individual level, we find that Social Security has virtually no effect on overall inequality. Second, we find that this result is driven largely by the lack of redistribution across the middle and upper part of the income distribution, so it masks some small positive net transfers to those at the bottom of the lifetime income distribution. Third, in cases where redistribution does occur, we find it is not efficiently targeted: many high income households receive positive net transfers, while many low income households pay net taxes. Finally, the redistributive effects of Social Security change over time, and these changes depend on the income concept used to classify someone as "poor".
    JEL: H22 H55
    Date: 2009–06
  12. By: Cinzia COLAPINTO
    Abstract: After looking at the relationship between journalism and public relations (PR) we analyze the impact of Internet on this interplay. A content analysis was conducted in order to investigate the utilization of the Internet for communicating corporate information -especially media relations - by the top Italian companies in the Mediobanca ranking lists. Analyses revealed that only 66% of Web sites have a dedicated press rooms where media content is centralized. The study shows that web-based corporate reporting in Italy is still in its infancy: lack of advanced technology such as RSS and corporate web blogs. News releases are the most frequently available materials, .
    Keywords: Media relation, Internet, content analysis, corporate websites, Italy
    JEL: D89 M39
    Date: 2008–06–19

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