nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2013‒01‒07
sixteen papers chosen by
Fabio Sabatini
Universita' la Sapienza

  1. Does Trust Favor Macroeconomic Stability? By Marc Sangnier
  2. Trust Drives Internet Use By Ljunge, Martin
  3. Trust Issues: Evidence from Second Generation Immigrants By Ljunge, Martin
  4. Seeds of Distrust: Conflict in Uganda By Dominic Rohner; Mathias Thoenig; Fabrizio Zilibotti
  5. The causal in fluence of social capital on immigrant health conditions in Canada. By Laporte, Audrey; Berchet, Caroline
  6. Trust and fertility dynamics By Arnstein Aassve; Francesco Billari; Léa Pessin
  7. Social Capital and Conflict By Alia Aghajanian
  8. Political Stability, Corruption and Trust in Politicians By Ingmar Schumacher
  9. Happier and less isolated: internet use in old age By Lelkes, Orsolya
  10. Do Ethnic Enclaves Impede Immigrants' Integration?: Evidence from a Quasi-Experimental Social-Interaction Approach By Alexander M. Danzer; Firat Yaman
  11. Social capital and economic performance: trust and distrust in eighteenth-century gold shipments from Brazil By Leonor Freire Costa,; Maria Manuela Rocha & Tanya Araujo,; Tanya Araujo,
  12. Mutual Insurance Networks in Communities By Pascal Billand; Christophe Bravard; Sudipta Sarangi
  13. Separating Will from Grace: An Experiment on Conformity and Awareness in Cheating By Toke Fosgaard; Lars Gaarn Hansen; Marco Piovesan
  14. The Effects of Information, Social and Economic Incentives on Voluntary Undirected Blood Donations: Evidence from a Randomized Controlled Trial in Argentina By Victor Iajya; Nicola Lacetera; Mario Macis; Robert Slonim
  15. On the coevolution of social norms in primitive societies By L. Bagnoli; G. Negroni
  16. Trust, Firm Organization and the Structure of Production By Federico Cingano; Paolo Pinotti

  1. By: Marc Sangnier (Aix-Marseille University (Aix-Marseille School of Economics), CNRS & EHESS)
    Abstract: This paper investigates the relationship between trust and macroeconomic volatility. An illustrative model rationalizes the relationship between trust and volatility. In this model, trust relaxes credit constraints and diminishes investment's procyclicality. I provide empirical evidence for the basic predictions of the model. Then, I show that higher trust is associated with lower macroeconomic volatility in a cross section of countries. This relationship persists when various covariates are taken into account. I use inherited trust of Americans as an instrumental variable for trust in their origin country to overcome reverse causality concerns. Using changes in inherited trust over the 20th century, I do not find clear evidence that increasing trust is also associated with decreasing volatility across time at the country level.
    Keywords: Trust, volatility, macroeconomic stability, social capital.
    JEL: E02 E30 N10
    Date: 2012–10
  2. By: Ljunge, Martin (Research Institute of Industrial Economics (IFN))
    Abstract: This paper estimates the effect of trust on internet use by studying the general population as well as second generation immigrants in 29 European countries with ancestry in 87 nations. There is a significant positive effect of trust on internet use. The positive trust effect is not universal to all media, as individuals with high trust are shown to consume less television. The finding provides evidence for one mechanism through which trust creates good outcomes. Individuals with high trust spend time online, and eschew the isolation of the TV couch, which may produce more productive opportunities.
    Keywords: Trust; Internet use; Intergenerational transmission; Cultural transmission; TV watching
    JEL: D13 D83 J62 Z13
    Date: 2012–12–20
  3. By: Ljunge, Martin (Research Institute of Industrial Economics (IFN))
    Abstract: This paper estimates the intergenerational transmission of trust by studying second generation immigrants in 29 European countries with ancestry in 87 nations. There is significant transmission of trust on the mother’s side. The transmission is stronger in Northern Europe. Ancestry from more developed countries suggests a stronger transmission of trust, but the heterogeneity in ancestry dissipates for individuals who reside in Northern Europe. The results suggest an interaction between cultural background and current institutions, where building trust in Northern Europe is a long process but the adjustment to the trust levels in Southern and Eastern Europe is fast.
    Keywords: Intergenerational transmission; Trust; Immigrants; Cultural transmission; Integration of immigrants
    JEL: D13 D83 J62 Z13
    Date: 2012–12–19
  4. By: Dominic Rohner (Department of Economics, University of Zurich); Mathias Thoenig (Department of Economics, University of Lausanne); Fabrizio Zilibotti (Department of Economics, University of Zurich, and Institute for International Economic Studies, Stockholm University)
    Abstract: We study the effect of civil conflict on social capital, focusing on the experience of Uganda during the last decade. Using individual and county-level data, we document large causal effects on trust and ethnic identity of an exogenous outburst of ethnic conflicts in 2002-05. We exploit two waves of survey data from Afrobarometer 2000 and 2008, including information on socioeconomic characteristics at the individual level, and geo-referenced measures of fighting events from ACLED. Our identification strategy exploits variations in the intensity of fighting both in the spatial and cross-ethnic dimensions. We find that more intense fighting decreases generalized trust and increases ethnic identity. The effects are quantitatively large and robust to a number of control variables, alternative measures of violence, and different statistical techniques involving ethnic and spatial fixed effects and instrumental variables. We also document that the post-war effects of ethnic violence depend on the ethnic fractionalization. Fighting has a negative effect on the economic situation in highly fractionalized counties, but has no effect in less fractionalized counties. Our findings are consistent with the existence of a self-reinforcing process between conflicts and ethnic cleavages.
    Keywords: ethnicity, violence, fractionalization
    JEL: D74
    Date: 2012–02
  5. By: Laporte, Audrey; Berchet, Caroline
    Abstract: Using a representative longitudinal survey of the immigrant population in Canada (the "Longitudinal Survey of Immigrants in Canada"), this article assesses the causal influence of social capital (as measured by social participation) on immigrant health status and health care use. Furthermore, it sheds light on the relationship existing between social capital, human capital and immigrant health conditions. We begin with Probit models but then address the identification issue of social capital using several bivariate dynamic Probit models. Estimation results are consistent with exiting literature since we nd a positive in uence of social participation on immigrant health status and health care use. Moreover, our analyses reveal that some social activities are more protective than others such as participation to sporting groups, church groups, cultural clubs or political associations. More importantly, the effect of social capital on immigrant health conditions seems to differ according to their human capital level, measured through educational attainment. In this respect, social capital appears to act as a substitute for human capital to enhance immigrant health status while we found a complementary effect between social and human capital to increase immigrant health care utilisation.
    Keywords: Immigrant health status; health care use;
    JEL: I38 I12 O15
  6. By: Arnstein Aassve; Francesco Billari; Léa Pessin
    Abstract: We argue that fertility trends in advanced societies are in part driven by differences in trust. The argument builds around the idea that trust implies individuals and couples being willing to outsource traditional family activities to other individuals outside their own family. Trust is therefore seen as a catalyser for the process of increased female labour force participation, the diffusion of childcare facilities, and hence a halt to the continuing fertility decline. Support of this hypothesis is drawn from the World Values Survey and European Values Survey. We present evidence both from country-level regressions and from a series of multilevel analyses. We find that trust by itself is positively associated with fertility over recent decades. Moreover, trust interacts with women’s education. In particular, as higher education for women has expanded, which traditionally is seen as a robust predictor for lower fertility, trust is a precondition for achieving higher fertility among those women with very high education.
    Keywords: Generalized trust, low fertility, women’s education, outsourcing, multilevel models
    Date: 2012–11
  7. By: Alia Aghajanian (Institute of Development Studies)
    Abstract: Conflict is either caused by, or brings about, drastic changes in the underlying social relationships between members of a community involved in the conflict. The conflict literature has taken note, and a growing number of studies attempt to determine the relationship between conflict and social capital. Unfortunately, there are many problems that have plagued the social capital literature, and conflict studies have failed to address these. This paper aims to provide a critical analysis of the literature on conflict and social capital, discuss the problems that can arise when studying social capital, how the conflict literature might address this, and highlight the gaps in the conflict and social capital literature.
    Keywords: Conflict, social capital
    JEL: D03
    Date: 2012–11
  8. By: Ingmar Schumacher (Department of Economics, Ecole Polytechnique - CNRS : UMR7176 - Polytechnique - X, IPAG - Business School)
    Abstract: In this article we develop a dynamic model where an endogenous evolution of trust impacts a politician's choice for bribe-taking and tax re-distribution. The politician obtains utility from net income that comes from his wage income, tax embezzlements and bribe-taking, and he also has incentives for tax re-distribution. The higher the tax embezzlements and the more bribes the politician takes the lower his citizens' trust and the less likely will he be re-elected. We support the evolution of trust with an econometric investigation. We analyze the necessary and su cient conditions, and nd that withholding taxes and taking bribes may be complements or substitutes for a politician, depending on the politician's incentives for tax re-distribution. Without these incentives, tax embezzlement and bribe taking are necessarily substitutes. With su ciently strong incentives, we nd re-distribution and bribe-taking may become complements. Complements implies that the politician, at least partly, increases bribe-taking because this allows him to increase re-distribution, which aids his additional motives for tax re-distribution. Based on comparative statics at steady state we also nd that the higher the politician's wage the lower the bribe-taking and the higher the trust; stronger social capital leads to less bribe-taking and higher levels of trust; improvements in electoral accountability induce a decrease in bribing while trust increases.
    Keywords: : trust; corruption; political stability; bribe; dynamic model.
    Date: 2012–12–10
  9. By: Lelkes, Orsolya
    Abstract: This paper explores the impact of internet use in old age on social isolation and on subjective well-being. Does internet use make older people less or more lonely? Does it crowd out face-to-face contacts or enhance them? We found that social isolation is lower among internet users aged 65 or over. Using a European multi-country cross-sectional dataset with over 11000 observations, we found that those who use the internet regularly have a lower chance of being isolated, more so for those who use the internet every day, controlling for personal characteristics such as income, marital status, gender and health condition. Thus, personal social meetings and virtual contacts are complementary, rather than substituting for each other. Internet use may be a useful way of reducing social isolation. We also found a positive relationship between regular internet use and self-reported life satisfaction, all else being equal. Our findings were robust in alternative specifications as well.
    Keywords: Social isolation; loneliness; internet use; old age; happiness
    JEL: I31 Z13
    Date: 2012–10
  10. By: Alexander M. Danzer; Firat Yaman
    Abstract: It is widely debated whether immigrants who live among co-ethnics are less willing to integrate into the host society. Exploiting the quasi-experimental guest worker placement across German regions during the 1960/70s as well as information on immigrants’ inter-ethnic contact networks and social activities, we are able to identify the causal effect of ethnic concentration on social integration. The exogenous placement of immigrants “switches off” observable and unobservable differences in the willingness or ability to integrate which have confounded previous studies. Evidence suggests that the presence of co-ethnics increases migrants’ interaction cost with natives and thus reduces the likelihood of integration.
    Keywords: immigrants, integration, enclaves, political participation, culture, social interaction, guest workers
    JEL: J15 R23 J61
    Date: 2012
  11. By: Leonor Freire Costa,; Maria Manuela Rocha & Tanya Araujo,; Tanya Araujo,
    Abstract: This article discusses agency problems in a period of market boom. It takes Portuguese trade with Brazil as a case study to discuss the impact of colonial market expansion on social capital. The hypothesis is that social capital depletion prompted an uneven distribution of information and a limited access to honest individuals, who might afford a premium to certain forms of agency. Given the states inability to provide legal sanctioning in colonial regions, this article focuses on private-order mechanisms which were effective for selecting reputable individuals. The exploration of network analysis identifies the mechanism that responds to such an adverse environment and supports the argument that business organizations which counted on the geographical mobility of agents had comparative advantages. The approach followed in this article brings new insights on informal institutional arrangements and on itinerancy in contexts of low levels of social capital.
    Date: 2012–07
  12. By: Pascal Billand (GATE Lyon Saint-Etienne - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - École Normale Supérieure - Lyon); Christophe Bravard (GATE Lyon Saint-Etienne - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - École Normale Supérieure - Lyon); Sudipta Sarangi (Department of Economics, Louisiana State University - Department of Economics, Louisiana State University)
    Abstract: We study the formation of mutual insurance networks in a model where every agent who obtains more resources gives a -xed amount of resources to all agents who have obtained less resources. The low resource agent must be directly linked to the high resource agent to receive this transfer. We identify the pairwise stable networks and e-cient networks. Then, we extend our model to situations where agents di-er in their generosity with regard to the transfer scheme. We show that there exist conditions under which in a pairwise stable network agents who provide the same level of transfers are linked together, while there are no links between agents who provide high transfers and agents who provide low transfers.
    Keywords: Mutual insurance networks; Pairwise stable networks; Effi cient networks
    Date: 2012–12–21
  13. By: Toke Fosgaard (Institute of Food and Resource Economics, University of Copenhagen); Lars Gaarn Hansen (Institute of Food and Resource Economics, University of Copenhagen); Marco Piovesan (Institute of Food and Resource Economics, University of Copenhagen)
    Abstract: In this paper we investigate if people cheat more when they observe their peers cheating because they conform or because they become aware that cheating is something to actively consider. In our experiment subjects toss a coin in private and report the outcome (white or black). We reward only those who report white and leave them the possibility to cheat without being discovered. In our 2x2 experimental design, we manipulated subjects’ report sheet to i) suggest (or not) that cheating is an option; ii) suggest that their peers were honest (or dishonest). We find that increasing awareness of cheating as an option significantly increases the probability that women cheat; whereas men – who are already aware that cheating is an option - are not affected. When we suggest that peers have cheated, men cheat significantly more, whereas women do not.
    Keywords: cheating, norms, conformity, awareness, gender differences
    JEL: D63 K42 D81
    Date: 2012–12
  14. By: Victor Iajya; Nicola Lacetera; Mario Macis; Robert Slonim
    Abstract: In many low- and middle-income countries blood donations per capita are substantially lower than in advanced economies. In these countries blood supply is mostly collected through donations by relatives and friends of individuals needing transfusions or to replace blood used in emergencies. The World Health Organization considers this method of blood supply inefficient compared to undirected voluntary donations. To examine methods to motivate undirected voluntary donations, we ran a large-scale, natural field experiment in Argentina testing the effectiveness of information, social and economic incentives. We find that only higher-valued economic incentives generated more donations, increasing in the value of the incentive. These incentives did not create adverse selection in the safety and usability of the donated blood. We discuss the implications of our findings for researchers interested in understanding motivations for pro-social behavior and for health agencies and policymakers concerned with the current and growing shortages in blood supply in low- and middle-income countries.
    JEL: C93 D03 H41 I15
    Date: 2012–12
  15. By: L. Bagnoli; G. Negroni
    Abstract: Two parties bargaining over a pie, the size of which is determined by their previous investment decisions. The bargaining rule is sensitive to investment behavior. Two games are considered. In both, bargaining proceeds according to the Nash Demand Game when a symmetric investments pro?le is observed. When, on the other hand, an asymmetric investments pro?le is observed, we assume that bargaining proceeds according to the Ultimatum Game in one case and according to a Dictator Game in the other. We hereby show that in both games when a unique stochastically stable outcome exists it supports an homogeneous behavior in the whole population both at the investment stage and at the distribution stage. A norm of investment and a norm of division must therefore coevolve in the two games, supporting both the efficient investment pro?le and the egalitarian distribution of the surplus, respectively. The two games differ depending on the conditions needed for the two norms to coevolve. The games are proposed to explain the social norms used in modern hunter-gatherer societies.
    JEL: C78 D83 L14 Z13
    Date: 2012–12
  16. By: Federico Cingano; Paolo Pinotti
    Abstract: Interpersonal trust favors the expansion of organizations by allowing the delegation of decisions and tasks among anonymous others or people that interact only infrequently. We document these facts for a representative survey of Italian manufacturing firms and use this source of data to construct an industry-specific measure of need-for-delegation in production. We then show that trust shapes comparative advantage, as high-trust regions and countries exhibit larger value added and export shares in delegation-intensive industries relative to other industries. Such effects are associated with an increase in average firm size, while the number of firms is not significantly affected. Larger average size reflects in turn a shift of the distribution away from the smallest firms, consistently with the idea that trust allows organizations to expand beyond the narrow circle of family members and close friends.
    Keywords: Trust, delegation, firm size, comparative advantage
    Date: 2012–09

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