nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2009‒10‒24
fifteen papers chosen by
Fabio Sabatini
University of Siena

  1. Does social capital prevent macroeconomic instability? By Marc Sangnier
  2. Identity and Islamic Radicalization in Western Europe By S Mansoob Murshed; Sara Pavan
  3. Innovation and Social Capital: A Cross-country Investigation By Soogwan Doh; Zoltan J. Acs
  4. The Impact of Empowering Investors on Trust and Trustworthiness By Kiridaran Kanagaretnam; Stuart Mestelman; Khalid Nainar; Mohamed Shehata
  5. A comparative analysis of different business ethics in the perspective of the Common Good By Cristina Montesi
  6. Social Capital and Economic Performance: some lessons from Farm Partnerships in Sweden By Fragkandreas, Thanos; Larsen, Karin
  7. Informal Social Protection in Post-Apartheid Migrant Networks: Vulnerability, Social Networks and Reciprocal Exchange in the Eastern and Western Cape, South Africa By Andries du Toit; David Neves
  8. Consumption, Social Capital, and the ‘Industrious Revolution’ in Early Modern Germany By Ogilvie, S.
  9. Favoritism By Yann Bramoullé; Sanjeev Goyal
  10. Do monetary rewards crowd out intrinsic motivations of volunteers? Some empirical evidence for Italian volunteers By Damiano Fiorillo
  11. Social Identities By Dietrich Rueschemeyer; Matthias vom Hau
  12. The influence of government size on economic growth and life satisfaction. A case study from Japan. By Yamamura, Eiji
  13. Contacts and Meetings: Location, Duration and Distance Traveled By Nebiyou Tilahun; David Levinson
  14. The Influence of Network Structure on Travel Distance By Pavithra Parthasarathi; Hartwig Hochmair; David Levinson
  15. Return Intentions among Potential Migrants and Commuters: The Role of Human Capital, Deprivation and Networks By Peter Huber; Klaus Nowotny

  1. By: Marc Sangnier
    Abstract: This paper investigates the relationship between social capital, measured as trust, and macroeconomic instability. It is shown in a cross section of countries that higher trust is associated with lower macroeconomic instability. We use the inherited trust of Americans as an instrumental variable of trust in their origin country to overcome all potential reverse causality concerns. Trust is shown to be an important determinant of macroeconomic stability.
    Date: 2009
  2. By: S Mansoob Murshed (Institute of Social Studies); Sara Pavan (Institute of Social Studies)
    Abstract: This paper argues that both socio-economic disadvantage and political factors, such as the West’s foreign policy with regard to the Muslim world, along with historical grievances, play a part in the development of Islamic radicalized collective action in Western Europe. We emphasise the role of group identity based individual behaviour in organising collective action within radicalized Muslim groups. Inasmuch as culture plays any role at all in radicalization, it is because individuals feel an imperative to act on the basis of their Muslim identity, something to which different individuals will attach varying degrees of salience, depending on how they place their Muslim identity based actions in the scheme of their multiple identities. We also emphasize the role of the opportunistic politician, from the majority European community, in fomenting hatred for Muslims, which also produces a backlash from radicalized political Islam. We present comparative evidence on socio-economic, political and cultural disadvantage faced by Muslim minorities in five West European countries: Germany, the UK, France, Spain and the Netherlands.
    Keywords: Peacekeeping; Identity, Radicalization, Clash of civilizations, Terrorism
    Date: 2009
  3. By: Soogwan Doh (George Mason University); Zoltan J. Acs (George Mason University)
    Abstract: This study explores the impact of social capital on innovation by constructing a more general measure of social capital indicator consisting of generalized and institutional trust, associational activities and civic norms. We test the hypothesis that social capital has a positive impact on innovation at the national level. After controlling for R&D expenditure and human capital there is a positive relationship between social capital and innovation. Social capital interacts with entrepreneurship and the strongest relationship is between associated activities and entrepreneurship. This is consistent with the need to build social relationships in today's networked economy.
    Keywords: human capital, social capital, entrepreneurship, innovation, generalized and institutional trust, civic norms, associational activities
    JEL: L26 J24 O31 O5
    Date: 2009–10–13
  4. By: Kiridaran Kanagaretnam; Stuart Mestelman; Khalid Nainar; Mohamed Shehata
    Abstract: This paper uses laboratory mechanism design in an investment environment to examine the impact of empowering investors with the right to veto the investee’s profit distribution decision on the level of trust and trustworthiness. One of the key findings is that the empowerment of investors through both costless and costly vetoes significantly increases trust by over 30% in both cases. Interestingly, we observe a comparable pattern when the power to veto is removed. Analyses of veto decisions indicate that empowering investors increases both trust and trustworthiness without an undue abuse of the power to veto and that the veto decisions are largely driven by unfair responses, consistent with the theory on inequity aversion.
    Keywords: Empowerment; Veto; Investment; Trust; Trustworthiness; Reciprocity
    JEL: C70 C91 D63 D81 D82
    Date: 2009–09
  5. By: Cristina Montesi
    Abstract: The paper concerns the connection between different tipologies of business ethics (kantian, utilitarian, aristotelic) and the alternative vision of economic development, company’s organizational and managerial context together with interest in Common Good more or less associated to profit to which they have given rise. In this comparison virtue ethics stands out for its capacity of creating, specially through the business virtue of generosity, social capital so precious to economic development at every level, for its capability of increasing people’s well-being, and for its capacity to make the production of relational goods (among which Common Good), on which people’s happiness depends, easier. Gift’s paradigm recovery can also be helpful to prevent other financial and economic crisis like the actual one which has had, like less striking but deepest cause, the triumph of avarice’s vice on the virtues of giving (generosity and justice).
    Keywords: Business Ethics, Gift’s Economy, Generosity, Charity, Mercy, Social Capital, Relational Goods, Common Good
    JEL: Z13
    Date: 2009–10–15
  6. By: Fragkandreas, Thanos; Larsen, Karin
    Abstract: The social capital literature usually perceives social capital as dues ex machine for economic performance. In this paper we use existing social capital theory to develop a conceptual framework to explain; (i) the importance of organizational capital as the ‘missing link’ between social capital and economic performance, and (ii) the phenomenon of ‘complementarity’ of different forms of capital (i.e. Physical, Financial, Human, Social, Organizational and Economic Capital) as a prerequisite for economic performance. The conceptual framework is applied to Swedish farm partnerships involving machinery- and labour sharing. Our study suggest that (i) social capital combined with other forms of capital, such as financial, human, physical and organizational leads to greater economic outcomes and (ii) the creation of organizational capital can explain higher economic performance.
    Keywords: Social Capital; Organizational Capital; Farm Partnerships; Economic Performance
    JEL: Z13 A14
    Date: 2009–08–09
  7. By: Andries du Toit; David Neves
    Abstract: This paper considers the dynamics of informal social protection in the context of chronic poverty and vulnerability in post-apartheid migrant networks. It argues that in poor and marginalised households in South Africa, the indirect impacts of social grants cannot be adequately understood by focusing simply on either individual or household decision making. Instead, the paper concentrates on the central role of the elaborate and spatially extended network of reciprocal exchange within the informal social protection systems. These networks link rural and urban households, and enable hybrid livelihood profiles to evolve that bridge rural and urban as well as formal and informal economic activities. These depend crucially on elaborate and gendered ‘care chains’ involving not only monetary remittances, but also paid and unpaid care work and household reproductive labour. The arrangements help the poor to survive, alleviate poverty and reduce vulnerability by allowing costs and resources, opportunities and shocks to be shared and redistributed. At the same time, these strategies have limitations, and are structured by deeply entrenched power relations pivoting on gender, age, status and other markers of exclusion. They may also increase the vulnerability of some individuals. This highlights the importance of the formal social protection system existing alongside the informal systems.
    Date: 2009
  8. By: Ogilvie, S.
    Abstract: This paper uses evidence from German-speaking central Europe to address open questions about the Consumer and Industrious Revolutions. Did they happen outside the early-developing, North Atlantic economies? Were they shaped by the “social capital” of traditional institutions? How were they affected by social constraints on women? It finds that people in central Europe did desire to increase market work and consumption. But elites used the “social capital” of traditional institutions to oppose new work and consumption practices, especially by women, migrants, and the poor. Although they seldom blocked new practices wholly, they delayed them, limited them socially, and increased their costs.
    Keywords: economic history; consumption; social capital; institutions; guilds; communities; labour; discrimination; gender; Germany
    JEL: N0 N33 N43 N63 N73 N93 J13 J22 J31 J4 J7 O15 O17
    Date: 2009–10–15
  9. By: Yann Bramoullé; Sanjeev Goyal
    Abstract: Favoritism is the act of offering jobs, contracts and resources to members of one's social group in preference to outsiders. Favoritism is widely practiced and this motivates an exploration of its origins and economic consequences. Our main finding is that individuals have an interest to trade favors over time and that this will come at the expense of others, who are outside their group. We show that favoritism is relatively easier to sustain in smaller groups. Favoritism entails social costs as it usually leads to inefficient allocations. However, favoritism can lead to payoff advantages for larger groups. Productivity enhancing investments are larger in groups which practice favoritism. The availability of investment opportunities can reinforce payoff inequalities across groups.
    Keywords: Favoritism, nepotism, reciprocity, repeated games
    JEL: C73 D71 J71 O10
    Date: 2009
  10. By: Damiano Fiorillo (-)
    Abstract: The paper studies the determinants of regular volunteering departing from previous literature on extrinsic and intrinsic motivations. It contributes to the literature investigating the role of monetary rewards to influence intrinsic motivation. Using a simple framework that allows me to study the effect of monetary rewards on intrinsic motivation, the paper shows, controlling for endogenous bias, that monetary rewards crowd-out intrinsic motivation.
    Keywords: Monetary rewards, Intrinsic motivation, Crowd-out effect
    JEL: C13 C21 C31 D12 Z13
    Date: 2009–10–10
  11. By: Dietrich Rueschemeyer; Matthias vom Hau
    Abstract: This paper develops a sociological perspective on the concept of social identities—that is relations of membership recognised as significant by members and outsiders. Social identities encompass face-to-face groups and local communities, as well as large groupings that transcend any conceivable form of direct interaction, as do ethnic groups, social classes, and nations. As collective creations, social identities help to shed light on individual behaviour as well as social outcomes, and are especially critical when analysts seek to understand the chances of collective action. A variety of actors and processes are involved in the creation and recreation of social identities, including commonalities that link up with major life interests; recognition by others, both wanted and unwanted; social conflict with outgroups; initiating entrepreneurs and continuous organisational support; links to socialisation and upbringing; the systematic cultivation of ritual and symbols; and the temporal order of all these processes. Conceptualised this way, social identities crucially link cultural patterns of allegiance and solidarity (as well as of discrimination and rejection) to the actions and dispositions of individuals, groups and organisations and to macro-background conditions such as comprehensive cultural patterns, social inequality, and overarching institutions.
    Date: 2009
  12. By: Yamamura, Eiji
    Abstract: This paper uses Japanese prefecture-level data for the years 1979 and 1996 to examine how the relationship between government size and life satisfaction changes. The major findings are: (1) Government size has a detrimental effect on life satisfaction when government size impedes economic growth in the economic developing stage. However, this effect clearly decreases when government size is not associated with economic growth in the developed stage. (2) Particularized trust is positively associated with life satisfaction of females but not with that of males. Such a tendency becomes more remarkable in the developed stage. These results are unchanged when the endogeneity bias caused by local government size and proxies of trust are controlled for.
    Keywords: Life satisfaction; Government size; Trust; Growth
    JEL: H50 H11 I31
    Date: 2009–10–14
  13. By: Nebiyou Tilahun; David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota)
    Abstract: The role of contacts on travel behavior has been getting increasing attention. This paper reports on data collected on individualÕs social meetings and the choice of in-home/out-of-home meeting locations as well as the distance travelled and duration of out-home-meetings and its relationship to the type of contact met and other attributes of the meeting. Empirically we show that in-home meetings tend to occur most often with close contacts and less often with distant contacts. The purpose, meeting day, and household size suggest that leisure, weekend and large household size people tend to have their meetings either at their home or at their contactÕs home. In addition when meetings occur outside of the house, the duration is longer for close contacts and distance to the meeting location is directly inßuenced by duration and indirectly by the relationship type. Overall the paper illustrates that relationship type along with other meeting speciÞc and demographic variables is important in explaining the location, duration and distance travelled for social meetings.
    Keywords: Travel behavior, social networks, meetings, network analysis
    JEL: R41 D10 D85 R48
    Date: 2009
  14. By: Pavithra Parthasarathi; Hartwig Hochmair; David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota)
    Abstract: The objective of this research is to identify the role of network architecture in influencing individual travel behavior using travel survey data from two urban areas in Florida: Fort Lauderdale and Miami. Various measures of network structure, compiled from existing sources, are used to quantify roadway networks, capture the arrangement and connectivity of nodes and links in the networks and the temporal and spatial variations that exist among and within networks. The results from the regression models estimated show that network design influences how people travel and make decisions. Results from this analysis can be used to understand how changes in network can be used to bring about desired changes in travel behavior.
    Keywords: Network structure, travel behavior, transport geography, commuting, circuity
    JEL: R41 R42 R48 D85 R14 R52
    Date: 2009
  15. By: Peter Huber (WIFO); Klaus Nowotny (WIFO)
    Abstract: We analyse determinants of duration of stay of cross-border commuters and migrants. Theory suggests that relative deprivation affects only intended duration of stay of migrants, but not of cross-border commuters. This is corroborated by econometric evidence. Also, return migrants and commuters are positively selected on education, networks are insignificant determinants of duration of stay while distance and education are more important for commuters' duration of stay. These results are robust over different estimation methods and apply both when measuring deprivation relative to friends and family and relative to the population residing in a region.
    Date: 2009–08–31

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