nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2013‒09‒13
seven papers chosen by
Fabio Sabatini
Universita' la Sapienza

  1. Trust and Financial Crisis Experiences By Carin van der Cruijsen; Jakob de Haan; David-Jan Jansen
  2. Long-term Persistence By Luigi Guiso; Paola Sapienza; Luigi Zingales
  3. Communicating with Farmers through Social Networks By Ariel BenYishay; A. Mushfiq Mobarak
  4. The cost of sin: The effect of social norms on audit pricing By Leventis, Stergios; Hasan, Iftekhar; Dedoulis , Emmanouil
  5. Virtual social currencies for unemployed people: social networks and job market access By Maëlle Della Peruta; Dominique Torre
  6. Self-organization of knowledge economies By Lafond, Francois
  7. Voluntary Pooled Public Knowledge Goods and Coalition Formation By Tom DEDEURWAERDERE; Paolo MELINDI GHIDI

  1. By: Carin van der Cruijsen; Jakob de Haan; David-Jan Jansen
    Abstract: Using eight annual surveys from the Netherlands between 2006 and 2013, we examine whether financial crisis experiences affect trust in banks, trust in the banking supervisor, and generalized trust. Adverse experiences during the financial crisis do not only directly lower trust in banks, but also have a negative effect on generalized trust. Customers of a bank that ran into problems have less trust in banks than respondents without this experience. Our results also indicate that respondents who were customer of a bank that failed have a significantly stronger decline of generalized trust than respondents without this experience. Personal financial crisis experiences do not have a significant effect on trust in the banking supervisor.
    Keywords: trust; bank bailout; bank failure; financial crisis; households; survey data
    JEL: D10 D84 E58
    Date: 2013–08
  2. By: Luigi Guiso (EIEF and CEPR); Paola Sapienza (Northwestern University, NBER and CEPR); Luigi Zingales (University of Chicago, NBER and CEPR)
    Abstract: We study whether culture has an independent role in creating persistence of institutional shocks by testing whether today’s notable differences in civic capital between the North and the South of Italy are the legacy of the medieval free city-state experience of the Middle Ages. We show that cities that experienced self-government in the Middle Ages have more civic capital today. This effect is observable even within the North and persists even accounting for the fact that cities did not become independent randomly. We conjecture that this effect persisted over time through the intergenerational transmission of attributional styles (i.e., the way people explain the events they experience to themselves). Consistently, we find that fifth-graders in former city-states exhibit a less pessimistic attributional style, which itself is correlated with a higher level of civic capital.
    Date: 2013
  3. By: Ariel BenYishay (University of New South Wales); A. Mushfiq Mobarak (Economic Growth Center, Yale University)
    Abstract: Low adoption of productive agricultural technologies is a puzzle. Agricultural extension services rely on external agents to communicate with farmers, although social networks are known to be the most credible source of information about new technologies. We conduct a large-scale field experiment on communication strategies in which extension workers are partnered with different members of social networks. We show that communicator actions and effort are susceptible to small performance incentives, and adoption rates vary by communicator type. Communicators who face conditions most comparable to target farmers are the most persuasive. Incorporating communication dynamics can enrich the literature on social learning.
    Keywords: social learning, agriculture, technology adoption, Malawi
    JEL: O33 O13 Q16
    Date: 2013–08
  4. By: Leventis, Stergios (School of Economics and Business Administration, International Hellenic University); Hasan, Iftekhar (Schools of Business, Fordham University and Bank of Finland); Dedoulis , Emmanouil (Department of Business Administration, Athens University of Economics and Business)
    Abstract: In this paper we provide evidence for the effects of social norms on audit pricing by studying companies belonging to the alcohol, firearms, gambling, military, nuclear power, and tobacco industries, which are often described as “sin” companies. We hypothesize that the disparities between “sin” firms operations and prevailing social norms create an adverse context which heightens the client’s business risk assessment by auditors and is, thereby, reflected in the pricing decisions for audit and consulting services. Having controlled for the impact of variables relating to client attributes, auditor attributes and engagement attributes, we demonstrate that audit firms charge significantly higher audit and consulting fees to companies that deviate from prevailing social norms. Additionally, we show that audit pricing levels within the “sin” group depend both on prevailing political views and on the vlevel of “vice” exhibited by “sin” companies.
    Keywords: social norms; audit pricing; controversial industries; sin companies
    JEL: G21 G30 G34 G38 M41
    Date: 2013–08–15
  5. By: Maëlle Della Peruta (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR7321 - Université Nice Sophia Antipolis [UNS]); Dominique Torre (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR7321 - Université Nice Sophia Antipolis [UNS])
    Abstract: Alternative currencies continue to develop all around the world, taking various forms (material or immaterial) and ful ll various functions. They are created in order to promote the local economy development and to ght against social exclusion. They are principally aimed to low income people (retired or unemployed people, or people who are living with a low wage). In this paper, we analyze the particular case of virtual currency circulation inside a local community of unemployed people. We elaborate on the assumptions that the organization of LETS and the circulation of complementary currencies have two properties: (i) they help unemployed workers to overcome the double coincidence of want necessity of an informal sector founded on barter exchange; (ii) they help to maintain and develop workers' skills outside job, helping them to observe opportunities of employment even as long-term unemployed workers. We study the global properties of a job market associating traditional short-term and long-term unemployment to the organization of LETS. Using a theoretical Pissarides-style model, we nd that the initial level of trust of agents in the complementary currency(cies) but also the e ective properties of his(these) currency(cies) are crucial for LETS to become permanent institutions. We also nd that if the stationary equilibrium of the job-market includes LETS, then LETS have a positive in uence on the rate of employment, on the expected utility of employed workers, and are Pareto improving when the benchmark case is a job market without any LETS.
    Keywords: Social currencies, complementary currencies, unemployment, informal sector.
    Date: 2013
  6. By: Lafond, Francois (UNU-MERIT / MGSoG)
    Abstract: Suppose that homogenous agents fully consume their time to invent new ideas and learn ideas from their friends. If the social network is complete and agents pick friends and ideas of friends uniformly at random, the distribution of ideas’ popularity is an extension of the Yule-Simon distribution. It has a power-law tail, with an upward or downward curvature. For infinite population it converges to the Yule-Simon distribution. The power law is steeper when innovation is high. Diffusion follows S-shaped curves.
    Keywords: innovation, diffusion, two-mode networks, cumulative advantage, quadratic attachment kernel, power law, Yule-Simon distribution, generalized hypergeometric distribution
    JEL: D83 D85 O31 O33
    Date: 2013
    Abstract: In this paper we develop a theoretical model of the mechanisms behind the voluntary provision of public knowledge goods in coalitions in presence of social preferences. The model builds on the large empirical literature on voluntary production of pooled public knowledge goods, such as source code in communities of software developers or data voluntarily provided to open access data repositories. This literature shows that the provision of public goods is strongly dependent on the presence of social preferences such as group identity and social approval of individual pro-social attitudes. To integrate these effects in standard public good theory this paper builds a private-collective model of public good provision, where contribution to public knowledge goods generates both public and exclusive private benefits for the members of the coalition only. The analysis shows that, when the private benefit is important, the effect of the social preferences on the coalition formation is ambiguous. In particular, in the latter case, in presence of strong individual reputational effects, the public knowledge goods will be more difficult to produce. The comparison of the predictions of the theoretical model with the stylized facts of large scale surveys of Free/Libre/Open-Source (FLOSS) software developers confirms the results of the model.
    Keywords: coalition formation, private-collective model, social group identity, pro-social reputation, public knowledge goods, social dilemma
    JEL: H42 D71
    Date: 2013–09–03

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