nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2013‒03‒30
eight papers chosen by
Fabio Sabatini
Universita' la Sapienza

  1. Social networks and wages in Senegal’s formal sector. By Berardi, N.
  2. Empathy, Sympathy, and Tax Compliance By Roberta Calvet; James Alm
  3. Social activity and collective action for agricultural innovation: a case study of New Rural Reconstruction in China By Huanxiu GUO; Mary-Françoise RENARD
  4. Social norms, family polices, and fertility trends: insights from a comparative study on the German-speaking region in Belgium By Sebastian Klüsener; Karel Neels; Michaela Kreyenfeld
  5. The effect of socio-economic and emotional factors on gambling behaviour By A. Bussu; Claudio Detotto
  6. Markets, Bargaining, and Networks with Heterogeneous Agents By Arnold Polanski; Fernando Vega-Redondo
  7. Do Good Institutions Lower the Benefit of Democratization? By Andreas Assiotis; Kevin Sylwester
  8. Does the Welfare State Destroy the Family? Evidence from OECD Member Countries By Martin Halla; Mario Lackner; Johann Scharler

  1. By: Berardi, N.
    Abstract: We develop a theoretical framework that considers the role played by moral hazard and the diversity of networks and cultures in the choice of hiring channel. In favoritism contexts social networks, and particularly strong ties, are adopted as hiring channels for unskilled jobs and result in wage penalties, while otherwise the opposite happens. We estimate an endogenous switching model for the case of Senegal's manufacturing formal sector and find, consistently with our theoretical predictions in case of favoritism, that informal hiring channels are preferred to fill unskilled vacancies and are associated with a wage penalty, especially when ties are stronger.
    Keywords: Social networks, Hiring channel, Wage differential.
    JEL: O12 J31
    Date: 2013
  2. By: Roberta Calvet (Department of Business Management and Communication, Lesley University); James Alm (Department of Economics, Tulane University)
    Abstract: This paper examines the effect of "empathy" and "sympathy" on tax compliance. We run a series of laboratory experiments in which we observe the subjects' decisions in a series of one-shot tax compliance games presented at once and with no immediate feedback. Importantly, we employ methods to identify subjects' sympathy, such as the Davis Empathic Concern Scale and questions about frequency of prosocial behaviors; we also use priming in order to promote subjects' empathy. Our results suggest that the presence of sympathy in most cases encourages more tax compliance. Our results also suggest that priming to elicit empathy also has a positive impact on tax compliance. These results support the inclusion of noneconomic factors in the analysis of tax compliance behavior.
    Keywords: Tax evasion; Emotions; Morality; Identity; Behavioral economics; Experimental economics
    JEL: H26 C91
    Date: 2013–02
  3. By: Huanxiu GUO; Mary-Françoise RENARD
    Abstract: Since 2003, a grass-roots movement of New Rural Reconstruction (NRR) has emerged in China to experience alternative model of rural development. The movement adopts a particular approach for rural development on basis of rural social and cultural reconstruction. In order to understand this social approach, we investigate an original NRR experiment in a poor village of south China, where organic farming is promoted by means of basketball game. An in-depth household survey is conducted to qualitatively analyze this social approach and derive intuitive hypothesis of extended social network for empirical test. With a panel structure dataset collected by the survey, we quantitatively identify the causal effect of social network by exploiting the endogeneity of social network formation. Our identification result provides micro evidence for a large social multiplier effect in the diffusion of organic farming, whereas it is negative for organic experts. Also, our results highlight the role of women, education and labor force for the development of organic farming. On basis of these results, we conclude that organic farming is suitable but challenging for small villages in China, while social activity is a good lever to achieve farmers' collective action for its large diffusion.
    Keywords: New rural reconstruction; Social network; Organic farming; China. D71, O33, Q55
    JEL: Q55 O33 D71
    Date: 2013
  4. By: Sebastian Klüsener (Max Planck Institute for Demographic Research, Rostock, Germany); Karel Neels; Michaela Kreyenfeld (Max Planck Institute for Demographic Research, Rostock, Germany)
    Abstract: Several countries in Northern and Western Europe report cohort fertility rates of close to two children per woman, including Belgium, France, and Denmark. By contrast, most Central and Southern European countries have cohort fertility levels of only around 1.5-1.6 children. Germany is part of this second group. In order to explain these country differences in fertility levels, some scholars have stressed the role of the social policy context, while others have pointed to differences in social fertility norms. However, due to the interdependence of these two factors, it is cumbersome to isolate their impact on fertility trends. In our study we at-tempt to disentangle these influences by drawing on a quasi-natural experiment. In the after-math of World War I, Germany was forced to cede the territory of Eupen-Malmedy to Bel-gium. The population in this area retained its German linguistic identity, but has been subject to Belgian social policies since the early 1920s. Our main research question is whether the fertility trends in this German-speaking region of Belgium follow the Belgian or the German pattern more closely. To answer this question, we use (micro)-census data to compare the fertility behavior in the German-speaking region in Belgium with data for western Germany and the Belgian Flemish- and French-speaking regions, controlling for individual-level char-acteristics. Our findings indicate that the overall fertility outcomes of the German-speaking region in Belgium resemble the Belgian pattern more than the German one. This provides support for the view that institutional factors play an important role for understanding the current fertility differences in Western Europe.
    Keywords: Belgium, Europe, Germany (Alte Bundesländer), family policies, fertility trends, social norms
    JEL: J1 Z0
    Date: 2013–03
  5. By: A. Bussu; Claudio Detotto
    Abstract: Gambling represents a channel through which some relevant aspects of our social life, such as audacity, competition and risk, manifest themselves. Gambling is both a pleasing diversion and a way of socialisation, where gratification and problematic issues alternate. Most gamblers are social players who participate in games without any relevant implications on their life, regardless of how frequently they engage in the activity. Unfortunately, in some cases gaming activities can have a dramatic impact on the player to the point that he/she has little control over them. In such cases, the approach to gaming can be defined as critical or even pathological. Pathological gambling is a serious form of addiction that causes gamblers to suffer from social and financial problems as they constantly look for ways to increase their “dose”. This study proposes a bivariate ordered probit approach aimed at examining the emotional factors of gambling expenditures and problematic behaviour or addiction while also controlling for socio-economic determinants. It is based on a survey among 1,315 gamblers in Sardinia (Italy) in the time span from June 2004 to March 2005. To measure gambling-related problems and gaming addiction we use survey responses on the existence of problems caused by game participation (in terms of psychological, relational, economic, labour difficulties directly linked to gambling) and on the need for help and/or the intention to stop the gambling experience. The findings show that women bet less than men and that income and gambling frequency are positively correlated with the amount of money allocated to gambling. Furthermore, having a sense of omnipotence and being willing to replay in case of a win increase the propensity to bet more money. Notably, women have a higher probability to be problematic gamblers after controlling for all other characteristics. Income is negatively associated with problematic gamblers while those who experience guilt or frustration after a loss and bet a higher amount of money have a higher probability of exhibiting gambling-related problems. Those who have other players in their family (wife/husband, children, brother/sister, parents and grandparents), do not play alone and gamble for many hours a day have a higher probability to become pathological gamblers. In addition, income positively affects the probability to have pathological consequences while education is negatively correlated to it. Finally, experiencing satisfaction in case of a win, disappointment in case of loss and excitement in the middle of the game is negatively associated with pathological players.
    Keywords: problem gambling; risk factors; emotional factors; gambling behaviour
    JEL: D01 D81 C35
    Date: 2013
  6. By: Arnold Polanski (University of East Anglia); Fernando Vega-Redondo (European University Institute)
    Abstract: The paper proposes an intertemporal model of bargaining among heterogeneous buyers and sellers placed on a bipartite network. First, it characterizes conditions on the network under which its trading restrictions are inessential and the outcome is arbitrage-free. Instead, when the system is segmented in different trading components, we show how these come about and how prices are determined in each of them. Second, we turn to the issue of network endogeneity, focusing on those networks that are Pairwise Stable. Such networks are shown to always exist and be arbitrage-free. In the latter respect, therefore, they satisfy one of the key properties displayed by frictionless markets. We identify, however, a sharp contrast regarding another key feature: Pairwise-Stable networks are generically inefficient if the matching process is genuinely decentralized. This uncovers a fundamental incompatibility between individual incentives and social welfare in endogenous trading networks. We explain that such incompatibility is not only due to buyer/seller heterogeneity but is also caused by the incentives underlying network formation in a trading context.
    Date: 2013–03
  7. By: Andreas Assiotis; Kevin Sylwester
    Abstract: Recent studies have reported positive associations between democratization and economic growth. They have also explored how these associations could differ across regions or income levels. However, might the effects of democratization upon growth also depend upon other factors such as institutions promoting law and order (or the lack thereof)? Using a panel specification, we employ a democratization-law and order interactive term to examine if the effects of democratization upon economic growth depend upon these other institutions. We find that the coefficient on the interaction term is negative. The positive effects of democratization diminish in countries where other institutions are strong. In fact, we find that democratization could even lower growth where the rule of law already prevails.
    Keywords: Democratization, Economic Growth, Institutions
    Date: 2013–03
  8. By: Martin Halla (Department of Economics, Vienna University of Economics and Business); Mario Lackner (Department of Economics, University of Linz); Johann Scharler (Department of Economics, University of Innsbruck)
    Abstract: We study the effect of the size of the welfare state on family outcomes in OECD member countries. Exploiting exogenous variation in public social spending, due to varying degrees of political fractionalization (i.e. the number of relevant parties involved in the legislative process), we show that an expansion in the welfare state increases the fertility, marriage, and divorce rates with a quantitatively stronger effect on the marriage rate. We conclude that the welfare state supports family formation. Nevertheless, we also find that the welfare state decouples marriage and fertility, and therefore, alters the organization of the family.
    Keywords: Marriage, divorce, fertility, welfare state, risk sharing
    JEL: J12 J13 J18 D1 D62 H31 H53
    Date: 2013–02

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