nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2011‒03‒12
fourteen papers chosen by
Fabio Sabatini

  1. Building Social Capital through Microfinance By Feigenberg, Benjamin; Field, Erica M.; Pande, Rohini
  2. Do Positional Concerns Destroy Social Capital: Evidence from 26 Countries By Justina A V Fischer; Benno Torgler
  3. Social Capital and Health of Older Europeans By Nicolas Sirven; Thierry Debrand
  4. Measuring the interaction between parents and children in Italian families: a structural equation approach By Anna Maccagnan
  5. Social Cohesiveness and gender Role Attitudes By VALENTOVA Marie
  6. La Dolce Vita: Hedonic Estimates of Quality of Life in Italian Cities By Emilio Colombo; Alessandra Michelangeli; Luca Stanca
  7. Clusters, Networks and Creativity By Karlsson, Charlie
  8. Social Comparison in the Workplace: Evidence from a Field Experiment By Cohn, Alain; Fehr, Ernst; Herrmann, Benedikt; Schneider, Frédéric
  9. Corruption and Social Interaction: Evidence from China By Bin Dong; Benno Torgler
  10. Pro-social preferences and self-selection into the public health sector: evidence from economic experiments By Kolstad, Julie Riise; Lindkvist, Ida
  11. Bringing the Four-Eyes-Principle to the Lab By Schickora, Jan Theodor
  12. Temptation at work By Alessandro Bucciol; Daniel Houser; Marco Piovesan
  13. Trust and financial trades By Radu Vranceanu; Angela Sutan; Delphine Dubart
  14. Religiosity as a determinant of happiness By Gundlach, Erich; Opfinger, Matthias

  1. By: Feigenberg, Benjamin (MIT); Field, Erica M. (Harvard University); Pande, Rohini (Harvard University)
    Abstract: A number of development assistance programs promote community interaction as a means of building social capital. Yet, despite strong theoretical underpinnings, the role of repeat interactions in sustaining cooperation has proven difficult to identify empirically. We provide the first experimental evidence on the economic returns to social interaction in the context of microfinance. Random variation in the frequency of mandatory meetings across first-time borrower groups generates exogenous and persistent changes in clients' social ties. We show that the resulting increases in social interaction among clients more than a year later are associated with improvements in informal risk-sharing and reductions in default. A second field experiment among a subset of clients provides direct evidence that more frequent interaction increases economic cooperation among clients. Our results indicate that group lending is successful in achieving low rates of default without collateral not only because it harnesses existing social capital, as has been emphasized in the literature, but also because it builds new social capital among participants.
    JEL: C81 C93 O12 O16
    Date: 2010–06
  2. By: Justina A V Fischer (University of Mannheim); Benno Torgler (QUT)
    Abstract: Research on the effects of positional concerns on individuals’ attitudes and behavior is sorely lacking. To address this deficiency, we use the International Social Survey Programme 1998 data on 25’000 individuals from 26 countries to investigate the impact of relative income position on three facets of social capital, covering horizontal and vertical trust as well as norm compliance. Testing relative deprivation theory, we identify a deleterious positional income effect for persons below the reference income, particularly for their social trust and confidence in secular institutions. Also often a social capital-lowering effect of relative income advantage occurs, while a rise in absolute income almost always contributes positively. These results indicate that a rise in income inequality in society too large is rather detrimental to the formation of social capital.
    Keywords: Relative income, positional concerns, social capital, social norms, deprivation theory
    JEL: Z13 I30 D31
    Date: 2011–02–17
  3. By: Nicolas Sirven (IRDES institut for research and information in health economics); Thierry Debrand (IRDES institut for research and information in health economics)
    Abstract: This research uses a time-based approach of the causal relationship (Granger-like)between health and social capital for older people in Europe. We use panel data from waves 1 and 2 of SHARE (the Survey of Health, Ageing, and Retirement in Europe)for the analysis. Additional wave 3 data on retrospective life histories (SHARELIFE)are used to model the initial conditions in the model. For each of the first 2 waves, a dummy variable for involvement in social activities (voluntary associations, church, social clubs, etc.) is used as a proxy for social capital as involvement in Putnamesque associations; and seven health dichotomous variables are retained, covering a wide range of physical and mental health measures. A bivariate recursive Probit model is used to simultaneously investigate (i) the influence of baseline social capital on current health - controlling for baseline health and other current covariates, and (ii)the impact of baseline health on current participation in social activities - controlling for baseline social capital and other current covariates. As expected, we account for a reversed causal effect: individual social capital has a causal beneficial impact on health and vice versa. However, the effect of health on social capital appears to be significantly higher than the social capital effect on health. These results indicate that the sub-population reaching 50 years old in good health has a higher propensity to take part in social activities and to benefit from it (social support, etc.). Conversely, the other part of the population in poor health at 50, may see its health worsening faster because of the missing beneficial effect of social capital. Social capital may therefore be a potential vector of health inequalities.
    Keywords: Healthy Ageing, Social Capital, Health Inequality, Granger Causality, Panel Data.
    JEL: C33 I12 Z13
    Date: 2011–02
  4. By: Anna Maccagnan
    Abstract: In this paper we theoretically and empirically analyse the capability to social interaction between parents and children in Italy, within a capability approach framework. For this purpose, after having identified the functionings and conversion factors related to this capability, we have built an integrated dataset for year 2008 with a procedure inspired to the propensity score matching. This allows us to work on a wide set of information, both on the realized functionings, ands on the personal and familiar factors that are likely to affect childrens attainments. We have analysed this data using descriptive statistics and structural equation modelling. Our results suggest lower levels of interaction for fathers that for mothers. Further, childrens capability to interact with the parents is negatively affected by the number of siblings in the household, by childs increasing age and by living in the South of Italy. Also parents characteristics are crucial: highly educated fathers tend to perform better in their interaction with the child and father-child relationship, furthermore, is positively affected by the fact that the mother is employed, while motherchild interaction does not significantly change.
    Keywords: Capability Approach, Human Development, Structural Equation Models
    JEL: C1 D6
    Date: 2011–02
  5. By: VALENTOVA Marie
    Abstract: The main aims of the present paper are to examine whether gender role attitudes mitigate or facilitate social cohesiveness of Luxembourg residents and to uncover whether this effect is moderated by gender. Social cohesiveness is measured by composite indicators: first two represent general dimensions of social cohesiveness (behavioural and attitudinal) and the remaining five stand for specific domains of the concept (institutional trust, solidarity, socio-cultural participation, political participation and social relations). Attitudes toward gender are operationalized into three indicators: childcare, homemaking and economic relations. The outcomes of the analysis reveal that traditional attitudes, mainly those regarding homemaking, have a mixed impact on social cohesiveness. On the one hand, being more traditional increases attitudinal level of cohesiveness, i.e. institutional trust and solidarity. On the other hand, it seems to negatively affect cohesiveness at behaviour level, concretely in the intensity of socio-cultural relations and political participation. Gender appears to moderate the effect of gender role attitudes on political participation and solidarity, implying that traditional attitudes decrease the level of these type of cohesiveness more among women than among men.
    Keywords: gender roles; social cohesion; attitudes; multidimensional concepts
    JEL: D63 Z13
    Date: 2011–02
  6. By: Emilio Colombo; Alessandra Michelangeli; Luca Stanca
    Abstract: This paper provides an assessment of quality of life in Italian cities using the hedonic approach. We analyze micro-level data for housing and labor markets to estimate compensating differentials for local amenities within five domains: climate, environment, services, society and economy. The estimated implicit prices are used to construct overall and domain-specific quality of life indices. We find that differences in amenities are re°ected in substantial compensating differentials in housing prices, whereas the effects on wages are relatively small. Quality of life varies substantially across space and is strongly related to differences in public services and economic conditions. Overall, quality of life is highest in medium-sized cities of the Center-North, displaying relatively high scores in all the domains considered. Northern cities fare better with respect to services, social and economic conditions, while relatively worse for climate and environmental conditions.
    Keywords: quality of life, hedonic prices, housing markets
    JEL: C4 D5 H4 J3 J6 P2 P3 Q2 R2
    Date: 2010–12
  7. By: Karlsson, Charlie (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology)
    Abstract: An extensive amount of studies have been devoted to the importance of the creative process. Creativity is critical to research and in particular to innovation, a key feature of economic competitiveness. Most of the previous studies have dealt with the creativity of individuals, the creativity of teams and the importance of the organisational context. This chapter, however, emphasises the role of the characteristics of the local and regional economic milieu where the creative process takes place and the local and non-local networks of such milieus. Both the local ‘buzz’ related to interaction and learning opportunities, and non-local networks associated with integration of different milieus, offer special but different advantages for creative activities. The milieu will play an important role in creativity by supplying both a large number of incompatible ideas and good conditions for bringing them together in order to gain new, profound insights. Local accessibility, i.e. clustering, of incompatible ideas and the interregional accessibility to incompatible ideas in other regions are a function of the network characteristics of the local milieu. The purpose of this chapter is to explore the spatial concentration of creativity and the role of clustering and networks in stimulating creative regional economic milieus. One of the arguments of the chapter highlights how clustering of creative agents and creative processes in specific locations generates creative advantages that stimulate creativity and the in-migration of creative agents. Furthermore, the chapter stresses the idea that a better connected economic milieu to other economic milieus via networks transmitting new ideas, information knowledge, etc., will generate higher creative potential of that economic milieu.
    Keywords: creativity; creative process; clusters; artistic clusters; network theory; regional economics; local milieu; local and non-local interaction; innovation
    JEL: O31 R11
    Date: 2010–10–28
  8. By: Cohn, Alain (University of Zurich); Fehr, Ernst (University of Zurich); Herrmann, Benedikt (University of Nottingham); Schneider, Frédéric (University of Zurich)
    Abstract: We conducted a randomized field experiment to examine how workers respond to wage cuts, and whether their response depends on the wages paid to coworkers. Workers were assigned to teams of two, performed identical individual tasks, and received the same performance – independent hourly wage. Cutting both team members' wages caused a substantial decrease in performance. When only one team member's wage was cut, the performance decrease for the workers who received the cut was more than twice as large as the individual performance decrease when both workers' wages were cut. This finding indicates that social comparison processes among workers affect effort provision because the only difference between the two wage cut conditions is the other team member's wage level. In contrast, workers whose wage was not cut but who witnessed their team member's pay being cut displayed no change in performance relative to the baseline treatment in which both workers' wages remained unchanged, indicating that social comparison exerts asymmetric effects on effort.
    Keywords: compensation, fairness, field experiment, social comparison
    JEL: C93 J33 M53
    Date: 2011–03
  9. By: Bin Dong (QUT); Benno Torgler (QUT)
    Abstract: We explore theoretically and empirically whether social interaction, including local and global interaction, influences the incidence of corruption. We first present an interaction-based model on corruption that predicts that the level of corruption is positively associated with social interaction. Then we empirically verify the theoretical prediction using within-country evidence at the province-level in China during 1998 to 2007. Panel data evidence clearly indicates that social interaction has a statistically significantly positive effect on the corruption rate in China. Our findings, therefore, underscore the relevance of social interaction in understanding corruption.
    Keywords: corruption, social interaction, China
    JEL: K42 D72 D64 O17 J24
    Date: 2010–11–26
  10. By: Kolstad, Julie Riise (University of Bergen); Lindkvist, Ida (CMI (Chr. Michelsen Institute)
    Abstract: There is growing interest in the role of pro-social motivation in public service delivery. In general, economists no longer question whether people have social preferences, but ask how and when such preferences will influence their economic and social decisions. Apart from revealing that individuals on average share and cooperate even when such actions lower their own material pay-off, economic experiments have documented substantial individual heterogeneity in the strength and structure of social preferences. In this paper we study the extent to which these differences are related to career choices, by testing whether preferences vary systematically between Tanzanian health worker students who prefer to work in the private health sector and those who prefer to work in the public health sector. Despite its important policy implications, this issue has received hardly any attention to date. By combining data from a questionnaire and two economic experiments, we find that students who prefer to work in the public health sector have stronger pro-social preferences than those who prefer to work in the private sector. We also show that the extent to which these students care about others can be conditional and linked to inequality aversion. A systematic selfselection of pro-socially motivated health workers into the public sector suggests that it is a good idea to have two sectors providing health services: this can ensure efficient matching of individuals and sectors by allowing employers in the two sectors to use different payment mechanisms tailored to attract and promote good performance from different types of health workers.
    Keywords: pro-social preferences; career choice; economic experiments; health workers
    JEL: H40 I18 J33 J45
    Date: 2010–04–01
  11. By: Schickora, Jan Theodor
    Abstract: The ‘Four-Eyes-Principle’ is considered as one of the most potent measures against corruption although it lacks both theoretical and empirical justification. We show in a laboratory experiment using a standard corruption game that introducing the 4EP increases corrupt behaviour, casting doubt on its usefulness as a general recommendation. Combining data on final choices with observations on the decision making processes in teams, including a content analysis of exchanged messages, provides insights into the dynamics of team decision making and shows that the individual profit maximizing motive dominates group decision making and crowds out altruistic arguments.
    Keywords: Corruption; Laboratory Experiments; Group Decision Making
    JEL: C72 C92 D73
    Date: 2011–03–01
  12. By: Alessandro Bucciol (University of Verona); Daniel Houser (George Mason University, Interdisciplinary Center for Economic Science.); Marco Piovesan (Harvard Business School)
    Abstract: To encourage worker productivity offices prohibit Internet use. Consequently, many employees delay Internet activity to the end of the workday. Recent work in social psychology, however, suggests that using willpower to delay gratification can negatively impact performance. We report data from an experiment where subjects in a Willpower Treatment are asked to resist the temptation to join others in watching a humorous video for 10 minutes. In relation to a baseline treatment that does not require willpower, we show that resisting this temptation detrimentally impacts economic productivity on a subsequent task.
    Keywords: temptation, willpower, lab experiment.
    JEL: C93 D01
    Date: 2011–02
  13. By: Radu Vranceanu (Economics Department - ESSEC Business School); Angela Sutan (ESC Dijon Bourgogne - ESC Dijon Bourgogne); Delphine Dubart (ESSEC Business School - ESSEC Business School)
    Abstract: In this paper we show that if a very small, exogenously given probability of terminating the exchange is introduced in an elementary investment game, reciprocators play more often the defection strategy. Everything happens as if they "hide behind probabilities" in order to break the trust relationship. Investors do no not seem able to internalize the reciprocators' change in behavior. This could explain why trades involving an exogenous risk of value destruction, such as financial transactions, provide an unfavorable environment for trust-building.
    Keywords: Experimental Economics ; Financial Transactions ; Investment Game ; Objective Risk ; Trust
    Date: 2010–05
  14. By: Gundlach, Erich; Opfinger, Matthias
    Abstract: We find a U-shaped relation between happiness and religiosity in cross-country panel data after controlling for income levels. At a given level of income, the same level of happiness can be reached with high and low levels of religiosity, but not with intermediate levels. A rise in income causes an increase in happiness along with a decline of religiosity. Our interpretation of the empirical results is that the indifference curves for religiosity and other commodities of the utility function are hump-shaped.
    Keywords: Happiness, religiosity, utility function, long-run development
    JEL: I31 Z12 O11
    Date: 2011–03

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.