nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2009‒12‒19
ten papers chosen by
Fabio Sabatini
University of Siena

  1. Social Networks By De Martí, Joan; Zenou, Yves
  2. Competition Builds Trust By Francois, Patrick; Fujiwara, Thomas; van Ypersele, Tanguy
  3. Work status and family planning: Insights from the Italian puzzle By Sabatini Fabio
  4. How Would your Kids Vote if I Open my Doors? Evidence from Venezuela By Rodriguez, Francisco; Wagner, Rodrigo
  5. On the Causal Impact of Relational Goods on Happiness By Leonardo Becchetti; Elena Giachin Ricca; Alessandra Pelloni
  6. The impact of human and social capital on entrepreneurs’ knowledge of finance alternatives By A. SEGHERS; S. MANIGART; T. VANACKER
  7. Trade Openness and Culture By Christopher Coyne; Claudia Williamson
  8. Cultivating Trust: Norms, Institutions and the Implications of Scale By Francois, Patrick
  9. Communication, Coordination and Networks By Choi, Syngjoo; Lee, Jihong
  10. Social Comparison and Performance: Experimental Evidence on the Fair Wage-Effort Hypothesis By Simon Gaechter; Christian Thoeni

  1. By: De Martí, Joan; Zenou, Yves
    Abstract: We survey the literature on social networks by putting together the economics, sociological and physics/applied mathematics approaches, showing their similarities and differences. We expose, in particular, the two main ways of modeling network formation. While the physics/applied mathematics approach is capable of reproducing most observed networks, it does not explain why they emerge. On the contrary, the economics approach is very precise in explaining why networks emerge but does a poor job in matching real-world networks. We also analyze behaviors on networks, which take networks as given and focus on the impact of their structure on individuals’ outcomes. Using a game-theoretical framework, we then compare the results with those obtained in sociology.
    Keywords: centrality measures; game theory; network formation; random graph; weak and strong ties.
    JEL: A14 C72 D85 Z13
    Date: 2009–12
  2. By: Francois, Patrick; Fujiwara, Thomas; van Ypersele, Tanguy
    Abstract: This paper shows that (firm-level) competition has a positive impact on (individual-level) trust. Using US states’ banking de-regulation from the mid 1970s, we first show that an increase in competition had a causal impact on trust, measured in the General Social Survey (GSS). We develop a model which explains why increased competition within a state increases trust. The model also predicts a positive correlation between trust and sectoral competitiveness in the cross-section. We explore this implication using the 2004 wave of the GSS which we match with US census of firms competition measures. The model’s predictions are strongly borne out.
    Keywords: Trust
    Date: 2009–12–02
  3. By: Sabatini Fabio
    Abstract: This paper uses a dataset built by the author on the basis of raw data taken from different national surveys to carry out an investigation into the socio-economic determinants of couples’ childbearing decisions in Italy. Since having children is in most cases a “couple matter”, the analysis accounts for the characteristics of both the aspiring parents. Our results contradict theoretical predictions according to which the increase in the opportunity cost of motherhood connected to higher female labour participation is responsible for the fall in fertility. On the contrary, the instability of the women’s work status (i.e. their being occasional, precarious, and low-paid workers) reveals to be a significant and strong dissuasive deterrent discouraging the decision to have children. Couples with unemployed women are less likely to plan childbearing as well. Other relevant explanatory variables are age, current family size, and the strength of family ties.
    Keywords: Fertility, Family planning, Childbearing, Labour market, Female participation, Labour precariousness, Social capital, Italy
    JEL: C25 J13 Z1
    Date: 2009–11
  4. By: Rodriguez, Francisco; Wagner, Rodrigo
    Abstract: For how long does cultural heritage persist? Do the culturally inherited values of immigrants dilute as generations pass? We answer these question by studying the relationship between revealed political behavior of immigrant families and the culture of the place where they migrated from, either one or many generations ago. Using surnames as indicators of region of origin of Italians in Venezuela, we study the effect of cultural heritage on two indicators of revealed political behavior: (i) propensity for civic engagement, and (ii) propensity for redistribution. A well established literature documents greater propensity for civic engagement and lower propensity for redistribution among Northern Italians. In Venezuela, we measure the former by turnout before the era of political polarization and the latter by signing behavior against Hugo Chávez in the 2004 recall referendum drive. Despite the fact that the wave of Italian immigration to Venezuela occurred more than half a century before the events studied in this paper, we do not find a greater propensity for civic engagement nor preference against redistribution among descendants from Northern as opposed to Southern Italians, suggesting that cultural assimilation may be a strong determinant of political behavior in the long run.
    Keywords: Social capital; political incorporation of immigrants; family economics; redistribution; political preferences; civic engagement; Latin America
    JEL: F22 Z1 P26
    Date: 2009–08–01
  5. By: Leonardo Becchetti (Faculty of Economics, University of Rome "Tor Vergata"); Elena Giachin Ricca (Faculty of Economics, University of Rome "Tor Vergata"); Alessandra Pelloni (Faculty of Economics, University of Rome "Tor Vergata")
    Abstract: We study the effect of relational goods on life satisfaction. We consider that retirement is an event after which the time investable in personal relationships increases so we instrument social life, which we suspect of being endogenous, with the sample proportion of retired by year. With such approach we document that relational goods have a positive and significant effect on life satisfaction.
    Keywords: life satisfaction, relational goods, social capital.
    JEL: I30 D61 A11 A13
    Date: 2009–12–04
    Abstract: This paper examines how entrepreneurs’ human and social capital influence their knowledge of finance alternatives. For this purpose, we use survey data from 125 Belgian start-ups. Results demonstrate that entrepreneurs with a business education and entrepreneurs with experience in accountancy or finance have a broader knowledge of finance alternatives. Having a strong network in the financial community further enhances the knowledge of finance alternatives. However, more generic human capital has almost no impact on the knowledge of finance alternatives. Overall, this study demonstrates how not only supply-side factors, but also demand-side factors may constrain entrepreneurs in their search for finance.
    Date: 2009–10
  7. By: Christopher Coyne (Department of Economics, West Virginia University); Claudia Williamson (Department of Economics, New York University)
    Abstract: This paper empirically analyzes the effect of trade openness on culture, measured by indicators of trust, respect for others, perceived level of self-determination, and level of obedience. These cultural categories play a central role in encouraging or limiting economic and social interactions and therefore impact economic outcomes. We find that trade openness has a positive and highly significant impact on culture. The more open a country is to trade, the more likely it is to possess culture conducive to increased social and economic interactions. This result is robust to the inclusion of a variety of control variables, different model specifications, and alternative trade measures.
    Keywords: culture, informal institutions, trade openness
    JEL: F15 O10 P50 Z1
    Date: 2009
  8. By: Francois, Patrick
    Abstract: We study the co-evolution of norms and institutions in order to better understand the conditions under which potential gains from new trading opportunities are realized. New trading opportunities are particularly vulnerable to opportunistic behavior and therefore tend to provide fertile ground for cheating. Cheating discourages production, raising equilibrium prices and therefore the return to cheating, thereby encouraging further cheating. However, such conditions also provide institutional designers with relatively high incentives to improve institutions. We show how an escape from the shadow of opportunism requires that institutional improvements out-pace the deterioration of norms. A key prediction from the model emerges: larger economies are more likely to evolve to steady states with strong honesty norms. This prediction is tested using a cross section of countries; population size is found to have a significant positive relationship with a measure of trust, even when controlling for standard determinants of trust and institutional quality.
    Keywords: Trust, Institutions, Population Size
    Date: 2009–12–02
  9. By: Choi, Syngjoo; Lee, Jihong
    Abstract: We study experimentally how the network structure and length of pre-play communication affect behavior and outcome in a multi-player coordination game with conflicting preferences. Network structure matters but the interaction between network and time effects is more subtle. Under each time treatment, substantial variations are observed in both the rate of coordination and distribution of coordinated outcomes across networks. But increasing the communication length improves both efficiency an equity of coordination. In all treatments, coordination is mostly explained by convergence in communication. We also identify behaviors that explain variations in the distribution of coordinated outcomes both within and across networks.
    Keywords: experiment; pre-play communication; coordination; network; efficiency; equity
    JEL: C92 D83 C72
    Date: 2009–11–20
  10. By: Simon Gaechter (University of Nottingham); Christian Thoeni (University of St. Gallen)
    Abstract: We investigate the impact of wage comparisons for worker productivity. We present three studies which all use three-person gift-exchange experiments. Consistent with Akerlof and Yellen's (1990) fair wage-effort hypothesis we find that disadvantageous wage discrimination leads to lower efforts while advantageous wage discrimination does not increase efforts on average. Two studies allow us to measure wage comparison effects at the individual level. We observe strongly heterogeneous wage comparison effects. We also find that reactions to wage discrimination can be attributed to the underlying intentions of discrimination rather than to payoff consequences.
    Keywords: fair wage-effort hypothesis, wage comparison, gift exchange, horizontal fairness, discrimination
    JEL: J31 J71 C91 C92
    Date: 2009–11

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