nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2011‒01‒03
thirteen papers chosen by
Fabio Sabatini

  1. See you on Facebook: the effect of social networking on human interaction By Antoci, Angelo; Sabatini, Fabio; Sodini, Mauro
  2. Trust, Positive Reciprocity, and Negative Reciprocity: Do These Traits Impact Entrepreneurial Dynamics? By Caliendo, Marco; Fossen, Frank M.; Kritikos, Alexander S.
  3. Resisting Moral Wiggle Room: How Robust is Reciprocity? By van der Weele, Joël; Kulisa, Julija; Kosfeld, Michael; Friebel, Guido
  4. Beliefs, values and attitudes of Portuguese population and their relationship with human and social capital By João Carlos Graça; Rafael Marques; João Carlos Lopes
  5. Public policy, trust and growth: disclosure of government information in Japan. By Yamamura, Eiji
  6. Indirect Effects of a Policy Altering Criminal Behaviour: Evidence from the Italian Prison Experiment By Francesco Drago; Roberto Galbiati
  7. Reducing Vulnerability through Microfinance: Evidence from Indian Self Help Group Program By Bali Swain, Ranjula; Floro, Maria
  8. Emotional Prosperity and the Stiglitz Commission By Oswald, Andrew J.
  9. Job Referral Networks and the Determination of Earnings in Local Labor Markets By Ian Schmutte
  10. Strategic Spending in Voting Competitions with Social Networks By Carlos Lever Guzmán
  12. Identification and Estimation of Social Interactions through Variation in Equilibrium Influence By Mikko Packalen
  13. The economic meaning of ‘intangible capital’ (according to World Bank research) By Marina, Ledeneva

  1. By: Antoci, Angelo; Sabatini, Fabio; Sodini, Mauro
    Abstract: This paper proposes an evolutionary framework to explore the dynamics of social interaction in an environment characterized by online networking and increasing pressure on time. The model shows how time pressure encourages the choice to develop social interactions also through online networking instead of relying exclusively on face to face encounters. Our findings suggest that the joint influence exerted by the reduction in leisure time and the new opportunities of participation offered by web-mediated communication may progressively lead a growing share of the population to adopt networking sites as an indispensable environment for the development of interpersonal relationships.
    Keywords: internet; computer-mediated communication; social networking; online networks; Facebook; human interaction; social capital
    JEL: O33 Z13 D85 C73
    Date: 2010–12–23
  2. By: Caliendo, Marco (IZA); Fossen, Frank M. (DIW Berlin); Kritikos, Alexander S. (DIW Berlin)
    Abstract: Experimental evidence reveals that there is a strong willingness to trust and to act in both positively and negatively reciprocal ways. So far it is rarely analyzed whether these variables of social cognition influence everyday decision making behavior. We focus on entrepreneurs who are permanently facing exchange processes in the interplay with investors, sellers, and buyers, as well as needing to trust others and reciprocate with their network. We base our analysis on the German Socio-Economic Panel and recently introduced questions about trust, positive reciprocity, and negative reciprocity to examine the extent that these variables influence the entrepreneurial decision processes. More specifically, we analyze whether i) the willingness to trust other people influences the probability of starting a business; ii) trust, positive reciprocity, and negative reciprocity influence the exit probability of entrepreneurs; and iii) willingness to trust and to act reciprocally influences the probability of being an entrepreneur versus an employee or a manager. Our findings reveal that, in particular, trust impacts entrepreneurial development. Interestingly, entrepreneurs are more trustful than employees, but much less trustful than managers.
    Keywords: entrepreneurship, trust, reciprocity
    JEL: D81 J23 M13 L26
    Date: 2010–12
  3. By: van der Weele, Joël (Goethe University Frankfurt); Kulisa, Julija (Goethe University Frankfurt); Kosfeld, Michael (Goethe University Frankfurt); Friebel, Guido (Goethe University Frankfurt)
    Abstract: Several studies have shown that dictator-game giving declines substantially if the dictator can exploit situational "excuses" for not being generous. In this experimental study we investigate if this result extends to more natural social interactions involving reciprocal behavior. We provide the second mover in a reciprocal game with an excuse for not reciprocating, an excuse which has previously been shown to strongly reduce giving in dictator games. We do not find that the availability of the excuse has any effect at all on reciprocal behavior, and conclude that reciprocity is a more stable disposition than dictator game generosity.
    Keywords: reciprocity, moral wiggle room
    JEL: C72 C9
    Date: 2010–12
  4. By: João Carlos Graça; Rafael Marques; João Carlos Lopes
    Abstract: Studying economic values and beliefs and their relationship with attitudes and behavior has been common in most social sciences throughout the world, at least since the 1960s. However, Portugal remained very much outside this research program and, contrary to the majority of European countries or the United States, it still lacks a coherent an integrative research on economic values, beliefs and behaviors. On the other hand, the existing data (European and World Value Surveys, Eurobarometer or the Portuguese Statistics Institute) only offers a partial view of the individual’s relationship with the economic system, namely consumer confidence or general ideas of trust. The studies already developed on this subject are normally restricted to the association of economic values and beliefs with socio-demographic characteristics, failing to include both the analysis of behaviors and the impact all these variables may have on economic performance indicators. The current study is intended as a first step towards a deeper comprehension of these phenomena. The general purpose of this study was to describe and explain the economic values, beliefs and attitudes of the Portuguese population and how they were associated with behaviors linked to economic performance. The research was oriented to four main goals: 1 – The description and explanation of the formation of economic values, beliefs, attitudes and behaviors, based on questionnaire submitted to a national sample, stratified by regional areas. 2 – The identification of the existent linkages between these micro-sociological variables and regional and national economic performance (e.g. GDP, unemployment rates, inflation, investment, debt and wages). 3 - The exploration of the role of human and social capital as moderators between micro-sociological variables and a support for different types of economic values. In this paper we explore the third goal, offering a tentative typology of economic values’ support.
    Keywords: Classification-
    Date: 2010–12
  5. By: Yamamura, Eiji
    Abstract: Since the end of the 1990s, local governments in Japan have enacted Information Disclosure Ordinances, which require the disclosure of official government information. This paper uses Japanese prefecture-level data for the period 1998–2004 to examine how this enactment affected economic growth. Furthermore, this paper explores how generalized trust is associated with the effect of information disclosure on economic growth. The Dynamic Panel model is used to control for unobserved prefecture specific effects and endogenous bias. The major findings are: (1) disclosure of government information has a positive effect on GDP growth; and (2) generalized trust enhances this effect on GDP growth. This implies that social trust has a critical influence on the effectiveness of policy.
    Keywords: Information disclosure; Local government; Trust; Growth
    JEL: D73 D78 Z13 D79
    Date: 2010–12–20
  6. By: Francesco Drago (Università di Napoli Parthenope and CSEF); Roberto Galbiati (CNRS EconomiX and Sciences Po Paris)
    Abstract: We exploit the Collective Clemency Bill passed by the Italian Parliament in July 2006 to evaluate the indirect effects of a policy that randomly commutes actual sentences to expected sentences for 40 percent of the Italian prison population. We estimate the direct and indirect impact of the residual sentence – corresponding to a month less time served in prison associated with a month of expected sentence – at the date of release on individual recidivism. Using prison, nationality and region of residence to construct reference groups of former inmates, we find large indirect effects of this policy. In particular, we find that the reduction in the individuals’ recidivism due to an increase in their peers’ residual sentence is at least as large as their response to an increase in their own residual sentence. From this result we estimate a social multiplier in crime of 2.
    Keywords: Crime, Natural Experiment, Indirect Effects of Policies, Social Interactions
    Date: 2010–12–14
  7. By: Bali Swain, Ranjula (Department of Economics); Floro, Maria (Department of Economics, American University)
    Abstract: We investigate if participation in Indian Self Help Group microfinance program (SHG) results in reducing vulnerability. Vulnerability estimates are constructed using cross-sectional SHG rural household survey data, collected in 2003. The potential selection bias is eliminated by propensity score matching to estimate the average treatment on treated effect using nearest neighbour matching and local linear regression algorithm. We find that despite a disproportionately high percentage of poor in the SHG members, vulnerability is not significantly different between the SHG and non-SHG members. This result is found to be robust using sensitivity analysis and Rosenbaum bounds method.
    Keywords: Microfinance; Vulnerability; Poverty; Self Help Groups
    JEL: D14 G21 I32
    Date: 2010–12–10
  8. By: Oswald, Andrew J. (University of Warwick)
    Abstract: This paper argues – in line with the proposals of the recent Stiglitz Commission on the Measurement of Economic Performance and Social Progress – that we should now be measuring a nation's emotional prosperity rather than its economic prosperity (that is, we ought to focus on the level of mental well-being not the number of pounds in people's bank accounts). The paper reviews recent ideas in this field. It also describes seven recent studies that, worryingly, suggest that emotional prosperity may be declining through time. For labour-market specialists, a key question for future research is how much this downward trend can be traced back to increased pressures in working life. That question currently remains open.
    Keywords: well-being, biomarkers, GHQ, happiness, Easterlin paradox
    JEL: I1 I3
    Date: 2010–12
  9. By: Ian Schmutte
    Abstract: Referral networks may affect the efficiency and equity of labor market outcomes, but few studies have been able to identify earnings effects empirically. To make progress, I set up a model of on-the-job search in which referral networks channel information about high-paying jobs. I evaluate the model using employer-employee matched data for the U.S. linked to the Census block of residence for each worker. The referral effect is identified by variations in the quality of local referral networks within narrowly defined neighborhoods. I find, consistent with the model, a positive and significant role for local referral networks on the full distribution of earnings outcomes from job search.
    Keywords: Social Interactions, Informal Hiring Networks, Wage Variation, Neighborhood Effects
    JEL: J31 J64 R23
    Date: 2010–12
  10. By: Carlos Lever Guzmán
    Abstract: This paper proposes a model of voting competitions (political campaigns and strategic lobbying) where voters are influenced by the opinion of their neighbors on a social network. In the unique pure strategy nash equilibrium, resources are targeted toward individuals with an influential position in the network. This finding contrasts with previous theories of strategic spending which predict that parties (or lobbies) should spend more on individuals who have a higher probability of being pivotal for the vote. The paper then tests the model using data on campaign contributions by interests groups in the US. House of Representatives. The estimations show that both network influence and pivotality are significant predictors of campaign contributions.
    Keywords: Network games, strategic spending, Colonel Blotto games, counteractive lobbying, Bonacich centrality
    JEL: D85 D72
    Date: 2010–12
  11. By: Benjamin Beranek (Department of Economics, Izmir University of Economics); Alper Duman (Department of Economics, Izmir University of Economics)
    Abstract: While the public good experiment has been used to analyze cooperation among various groups in Western Europe and North America, it has not been extensively used in other contexts such as Turkey. This project seeks to rectify that and explore how Turkish university students informally self govern. By employing the public good experiment among a cohort of students attending universities in Ýzmir, Turkey and Adýyaman, Turkey, we hope to quantitatively analyze the factors which lead to altruistic punishment, to antisocial punishment, and ultimately to enhanced cooperation in Turkish society.
    Keywords: Cooperation, Free Riding, Altruism, Punishment, Trust, Experimental Economics, Public Good Experiments
    JEL: C72 C91
    Date: 2010–10
  12. By: Mikko Packalen (Department of Economics, University of Waterloo)
    Abstract: This paper presents a new method for estimating social interaction effects. The proposed approach is based on using network interaction structure induced variation in equilibrium influence to construct conditionally balanced interaction structures. As equilibrium influence is determined by the known interaction structure and the unknown endogenous social interaction parameter, interaction structures are constructed for different imputed values of the unknown parameter. Each constructed interaction structure is conditionally balanced in the sense that when it is combined with observations on the outcome variable to construct a new variable, the constructed variable is a valid instrumental variable for the endogenous social interaction regressor if the true and imputed parameter values are the same. Comparison of each imputed value with the associated instrumental variable estimate thus yields a confidence set estimate for the endogenous social interaction parameter as well as for other model parameters. We provide conditions for point identification and partial identification. The contrast between the proposed and existing approaches is stark. In the existing approach instruments are constructed from observations on exogenous variables, whereas in the proposed approach instruments are constructed from observations on the outcome variable. Both approaches have advantages, and the two approaches complement one another. We demonstrate the feasibility of the proposed approach with analyses of the determinants of subjective college completion and income expectations among adolescents in the Add Health data and with Monte Carlo simulations of Erdös-Rényi and small-world networks.
    JEL: C31
    Date: 2010–12
  13. By: Marina, Ledeneva
    Abstract: In the following article, it will be proven on the basis of correlation analysis that ‘intangible capital,’ interpreted by the World Bank as both human capital and the quality of the institutions supporting economic activity, in fact represents the actual capacities of a given country to export non-commodity goods. The significant amount of ‘intangible capital’ found in highly developed countries lies in sharp contrast to the relatively smaller amount found in Russia; explained by its colonial-type trade system and the multiplier effect of added value.
    Keywords: intangible capital; national wealth; added value; unequal exchange; export of raw materials
    JEL: F14 E01 F54
    Date: 2010–12–19

This nep-soc issue is ©2011 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.