nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2016‒05‒21
eleven papers chosen by
Fabio Sabatini
Università degli Studi di Roma “La Sapienza”

  1. Image Versus Information: Changing Societal Norms and Optimal Privacy By Ali, S. Nageeb; Benabou, Roland
  2. Liberation technology: mobile phones and political mobilization in Africa By Marco Manacorda; Andrea Tesei
  3. The Impact of Taxes and Wasteful Government Spending on Giving By Sheremeta, Roman; Uler, Neslihan
  4. Family Networks and Distributive Politics By Fafchamps, Marcel
  5. Social Networks and Housing Markets By Bailey, Michael; Cao, Ruiqing; Kuchler, Theresa; Ströbel, Johannes
  6. Trust in trade: The causal role of social trust on individual trade preferences By Daniel Rais
  7. Boosting cooperation between agents in diverse groups: a dynamical model of prosocial behavior, free-riding and coercive solutions. By Solferino, Nazaria; Taurino, SerenaFiona; Tessitore, M.Elisabetta
  8. Public Sector Corruption and Trust in the Private Sector By Gillanders, Robert; Neselevska, Olga
  9. Cooperating, fast and slow: Testing the social heuristic hypothesis By Strømland, Eirik; Tjøtta, Sigve; Torsvik, Gaute
  10. A note on charitable giving by corporates and aristocrats: Evidence from a field experiment By Bassi, Vittorio; Huck, Steffen; Rasul, Imran
  11. The implications of labor market network for business cycles By Marcelo Arbex; Sydney Caetano; Dennis O'Dea

  1. By: Ali, S. Nageeb; Benabou, Roland
    Abstract: We analyze the costs and benefits of using social image to foster virtuous behavior. A Principal seeks to motivate reputation-conscious agents to supply a public good. Each agent chooses how much to contribute based on his own mix of public-spiritedness, private signal about the value of the public good, and reputational concern for appearing prosocial. By making individual behavior more visible to the community the Principal can amplify reputational payoffs, thereby reducing free-riding at low cost. Because societal preferences constantly evolve, however, she knows only imperfectly both the social value of the public good (which matters for choosing her own investment, matching rate or legal policy) and the importance attached by agents to social esteem and sanctions. Increasing publicity makes it harder for the Principal to learn from what agents do (the "descriptive norm") what they really value (the "prescriptive norm" ), thus presenting her with a tradeoff between incentives and information aggregation. We derive the optimal degree of privacy/publicity and matching rate, then analyze how they depend on the economy's stochastic and informational structure. We show in particular that in a fast-changing society (greater variability in the fundamental or the image-motivated component of average preferences), privacy should generally be greater than in a more static one.
    Keywords: conformity; esteem; incentives; privacy; reputation; shaming punishments; Social norms; societal change; transparency
    JEL: D62 D64 D82 H41 K42 Z13
    Date: 2016–04
  2. By: Marco Manacorda; Andrea Tesei
    Abstract: Can digital information and communication technology (ICT) foster mass political mobilization? We use a novel geo-referenced dataset for the entire African continent between 1998 and 2012 on the coverage of mobile phone signal together with geo-referenced data from multiple sources on the occurrence of protests and on individual participation in protests to bring this argument to empirical scrutiny. We find that mobile phones are instrumental to mass mobilization during economic downturns, when reasons for grievance emerge and the cost of participation falls. Estimated effects are if anything larger once we use an instrumental variable approach that relies on differential trends in coverage across areas with different incidence of lightning strikes. The results are in line with insights from a network model with imperfect information and strategic complementarities in protest provision. Mobile phones make individuals more responsive to both changes in economic conditions - a mechanism that we ascribe to enhanced information - and to their neighbors’ participation - a mechanism that we ascribe to enhanced coordination. Empirically both effects are at play, highlighting the channels through which digital ICT can alleviate the collective action problem.
    Keywords: mobile phones; collective action; Africa; geo-referenced data
    JEL: O32 O47
    Date: 2016–03
  3. By: Sheremeta, Roman; Uler, Neslihan
    Abstract: We examine the impact of taxes and wasteful government spending on charitable giving. In our model, the government collects a flat-rate tax on income net of donations and wastes part of the tax revenue before redistribution. The model provides theoretical predictions which we test in a framed field experiment. The results of the experiment show that the tax rate has a weak and insignificant effect on giving. The degree of waste, however, has a large, negative and significant effect on giving, with the relationship moderated by the curvature in the utility function.
    Keywords: giving, charity donations, tax, waste, redistribution, experiments
    JEL: C90 D64 H41
    Date: 2016–04–27
  4. By: Fafchamps, Marcel
    Abstract: We argue that incumbents share rents with central players to build and sustain coalitions. Using an unusually rich dataset, we show that households with high betweenness centrality - a measure of brokerage potential - receive more public services from their local government. This result is robust to the inclusion of controls for program eligibility, family ties with politicians, and other measures of centrality - which are not significant once betweenness is included. We provide further corroboration from indirect evidence from variation in size and electoral competition across municipalities. Finally, we show that in municipalities where politicians provide more goods and services to their relatives they target fewer goods to households with high betweenness centrality. The evidence supports the hypothesis that incumbent municipal politicians offer favorable access to public services to households most able to play a brokerage role in the formation of coalitions of families for electoral support.
    Date: 2016–04
  5. By: Bailey, Michael; Cao, Ruiqing; Kuchler, Theresa; Ströbel, Johannes
    Abstract: We document that the recent house price experiences within an individual's social network affect her perceptions of the attractiveness of property investments, and through this channel have large effects on her housing market activity. Our data combine anonymized social network information from Facebook with housing transaction data and a survey. We first show that in the survey, individuals whose geographically-distant friends experienced larger recent house price increases consider local property a more attractive investment, with bigger effects for individuals who regularly discuss such investments with their friends. Based on these findings, we introduce a new methodology to document large effects of housing market expectations on individual housing investment decisions and aggregate housing market outcomes. Our approach exploits plausibly-exogenous variation in the recent house price experiences of individuals' geographically-distant friends as shifters of those individuals' local housing market expectations. Individuals whose friends experienced a 5 percentage points larger house price increase over the previous 24 months (i) are 3.1 percentage points more likely to transition from renting to owning over a two-year period, (ii) buy a 1.7 percent larger house, (iii) pay 3.3 percent more for a given house, and (iv) make a 7% larger downpayment. Similarly, when homeowners' friends experience less positive house price changes, these homeowners are more likely to become renters, and more likely to sell their property at a lower price. We also find that when individuals observe a higher dispersion of house price experiences across their friends, this has a negative effect on their housing investments. Finally, we show that these individual-level responses aggregate up to affect county-level house prices and trading volume. Our findings suggest that the house price experiences of geographically-distant friends might provide a valid instrument for local house price growth.
    Keywords: disagreement; Expectation Formation; House Price Dynamics; Social Networks
    JEL: D12 D14 D84 G12 R21
    Date: 2016–05
  6. By: Daniel Rais
    Abstract: While most explanations of individual trade policy preferences center on the redistributional implications of trade, recent research is particularly interested in the role of non-economic determinants. We join the latter line of research by studying the effect of social trust. Our research breaks new methodological ground by testing the hypothesized causal effect of social trust in a field survey experiment that combines a voluntary contribution game with a survey. The empirical work was carried out in Hanoi, Vietnam. The findings offer robust support for the argument that social trust has a positive causal effect on public support for international trade.
    Date: 2014–07–08
  7. By: Solferino, Nazaria; Taurino, SerenaFiona; Tessitore, M.Elisabetta
    Abstract: Cooperation is usually stronger towards in-group members, because giving an upright signal about themselves implies higher possibilities of reciprocity among members with the same social identity. We examine the case where collaboration between two groups is a mandatory condition to achieve success in a particular project, but in the first one, the social identity is quite strong. We show that the existence of a small share of prosocial players in the first group can create a sort of "imitation effect" so that each new member puts more effort in cooperating with the outsiders. On the other side, to avoid free-riding effort should be conditional to the other's commitment. This way to boost cooperation is usually more efficient than a coercive strategy in the presence of significant sized majorities or feelings of resentments. Our analysis suggests that it is appropriate, under some circumstances, to stimulate a multicultural paradigm devoted to value and manage diversity through an acculturation process emphasizing adaptation, interdependence, and mutual appreciation of different cultures.
    Keywords: Cooperation, Dynamical Analysis, Groups, Identity.
    JEL: C61 C71 D71
    Date: 2016–05–13
  8. By: Gillanders, Robert; Neselevska, Olga
    Abstract: In this paper we use data from the Afrobarometer surveys to demonstrate that there is an undesirable spill-over from petty corruption in the public sector to trust in private sector institutions. Our results show that experiencing bribery in the course of one’s interactions with the public sector lowers one’s trust in big private corporations, small businesses, and local traders. This finding holds even when we allow for perceptions of political corruption to enter the specification. We do not find any significant association between a measure of interpersonal trust and bribery experience which suggests that our findings with regards to market institutions are not driven by corruption lowering trust in general. Having to pay a bribe for household services, which is perhaps the setting most like a private sector transaction, is the corrupt interaction most strongly associated with the decline in private sector trust. We find some evidence that the spill-over is larger in democracies than in non-democratic regimes. Given the importance of trust in market institutions for the efficient functioning of an economy, our findings thus point to a previously unknown and potentially substantial cost of corruption and add to the case for anti-corruption efforts.
    Keywords: bribery, corruption, corruption experiences, corruption perceptions, private sector trust, sub-Saharan Africa, trust
    JEL: D73 K4 O10 O55
    Date: 2016–04
  9. By: Strømland, Eirik (Department of Economics, University of Bergen); Tjøtta, Sigve (Department of Economics, University of Bergen); Torsvik, Gaute (Department of Economics, University of Oslo)
    Abstract: Are humans intuitively cooperative, or do we need to deliberate in order to be generous to others? The Social Heuristics Hypothesis (SHH) proposes that fast instinctive decision making promotes cooperation in social dilemmas. In this paper, we conduct a novel time-pressure experiment to shed light on the cognitive underpinnings of cooperation. Although we find no evidence for a time-pressure effect when considering all subjects, our results, together with a re-analysis of independent data, indicate that a single factor – payoff comprehension – accounts for some studies failure to replicate the finding that fast and intuitive decision making promotes cooperation. Given payoff comprehension, the SHH predicts behavior well. We believe this finding provides a unifying interpretation of the conflicting results in the literature.
    Keywords: Cooperation; Intuition; Dual-Process; Public Goods Game
    JEL: C72 C91 C92 D03
    Date: 2016–04–25
  10. By: Bassi, Vittorio; Huck, Steffen; Rasul, Imran
    Abstract: Multiple sources of funding are becoming increasingly important for charitable organizations. Donations from corporate donors for example account for 25-35% of charitable income for the largest US charities, across charitable sectors. This note presents some tentative first evidence from a natural field experiment to shed light on how different types of potential donors: individuals, corporates and aristocratically titled individuals, respond to the same fundraising drive. Each donor type was randomly assigned to treatments varying in two dimensions: (i) whether information was conveyed about the existence of an anonymous lead donor; (ii) how individual donations would be matched by the anonymous lead donor. We find that aristocrats are significantly more likely to respond and that corporates give significantly more than individuals. Treatment effects moreover suggest that (proportional) matching is to be avoided for corporate donors.
    Keywords: agency problems,charitable giving,corporate donors,aristocratic donors,field experiment
    JEL: C93 D12 D64
    Date: 2016
  11. By: Marcelo Arbex (Department of Economics, University of Windsor); Sydney Caetano (Faculdade de Economia, Universidade Federal de Juiz de Fora); Dennis O'Dea (Department of Economics, University of Washington)
    Abstract: This paper modifies the standard labor market search model with social networks. Labor market networks is an important job information transmission channel and the complementarity of network and direct search by the unemployed amplify the economy's short-run response to a technological shock. We show that network search has important quantitative consequences for the business cycle, in particular, for output and unemployment.
    Keywords: Business Cycles; Labor Markets; Social networks; Job search.
    JEL: D85 E24 E32 J64
    Date: 2016–04

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