nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2016‒08‒07
eleven papers chosen by
Fabio Sabatini
Università degli Studi di Roma “La Sapienza”

  1. Cultural Transmission and Socialization Spillovers in Education By Del Bello, Carlo; Panebianco, Fabrizio; Verdier, Thierry; Zenou, Yves
  2. Does Experience Affect Fairness and Reciprocity in Lab Experiments? By Tiziana Medda; Vittorio Pelligra; Tommaso Reggiani
  3. Migrant Networks and Trade: The Vietnamese Boat People as a Natural Experiment By Parsons, Christopher; Vézina, Pierre-Louis
  4. Gender-Oriented Languages and Female Labour Force Participation: Evidence from Sub-Saharan Africa By Michelle Rao
  5. Innovation, Pricing and Targeting in Networks By Fabrizio Panebianco; Thierry Verdier; Yves Zenou
  6. Where to Look for the Morals in Markets? By Sutter, Matthias; Huber, Jürgen; Kirchler, Michael; Stefan, Matthias
  7. Does Empathy Beget Guile? Experimental Evidence By Chen, Daniel L.
  8. Social Ties of University Students: Evidence from a Longitudinal Survey in Russia By Ekaterina V. Krekhovets; Liudmila A. Leonova
  9. In God We Learn? Religions' Universal Messages, Context-Specific Effects, and Minority Status By Méon, Pierre-Guillaume; Tojerow, Ilan
  10. Cooperation among behaviorally heterogeneous players in social dilemma with stay of leave decisions By Xiaochuan Huang; Takehito Masuda; Yoshitaka Okano; Tatsuyoshi Saijo
  11. Young Adults Living with Their Parents and the Influence of Peers By Adamopoulou, Effrosyni (Efi); Kaya, Ezgi

  1. By: Del Bello, Carlo; Panebianco, Fabrizio; Verdier, Thierry; Zenou, Yves
    Abstract: We propose a model of the intergenerational transmission of education where children belong to either high-educated or low-educated families. Children choose the intensity of their social activities while parents decide how much educational effort to exert. We characterize the equilibrium and show under which condition cultural substitution or complementarity emerges. There is cultural substitution (complementarity) if parents decrease (increase) their education effort when their child socializes more with other children of the same type. By structurally estimating our model to the AddHealth data in the United States, we find that there is cultural complementarity for high-educated parents and cultural substitution for low-educated parents. This means that, for both parents, the more their children interact with kids from high-educated families, the more parents exert educational effort. We also perform some policy simulations. We find that policies aiming at mixing high and low educated children perform well in terms of average educational outcomes. We also show that a policy that gives vouchers to children from high-educated families have a positive and significant impact on the educational outcomes of all children while a policy that gives vouchers to children from low-educated families has a negative effect on the outcomes of both groups.
    Keywords: cultural transmission.; education; homophily; Social Networks
    JEL: D85 I21
    Date: 2016–07
  2. By: Tiziana Medda (University of Cagliari); Vittorio Pelligra (University of Cagliari); Tommaso Reggiani (LUMSA University)
    Abstract: One of the most common criticisms about the external validity of lab experiments in economics concerns the representativeness of participants usually considered in these studies. The ever-increasing number of experiments and the prevalent location of research centers in university campuses produced a peculiar category of subjects: Students with high level of laboratory experience built through repeated participations in experimental sessions. We investigate whether the experience accumulated in this way biases subjects’ behaviour in a set of simple games widely used to study social preferences (Dictator Game, Ultimatum Game, Trust Game, and Prisoner’s Dilemma Game). Our main finding shows that subjects with a high level of experience in lab experiments do not behave in a significantly different way from novices.
    Keywords: Experimental Methodology, External Validity, Experience, Lab Experiment
    JEL: D03 D83 C91 C92
    Date: 2016–07
  3. By: Parsons, Christopher (University of Western Australia); Vézina, Pierre-Louis (King's College London)
    Abstract: We provide evidence for the causal pro-trade effect of migrants and in doing so establish an important link between migrant networks and long-run economic development. To this end, we exploit a unique event in human history, i.e. the exodus of the Vietnamese Boat People to the US. This episode represents an ideal natural experiment as the large immigration shock, the first wave of which comprised refugees exogenously allocated across the US, occurred over a twenty-year period during which time the US imposed a complete trade embargo on Vietnam. Following the lifting of trade restrictions in 1994, US exports to Vietnam grew most in US States with larger Vietnamese populations, themselves the result of larger refugee inflows 20 years earlier.
    Keywords: migrant networks, US exports, natural experiment
    JEL: F14 F22
    Date: 2016–07
  4. By: Michelle Rao
    Abstract: Using the data from the Demographic and Health Surveys, this paper estimates the relationship between language and labour force participation of women in Sub-Saharan Africa. The results suggest that women who speak languages with stronger distinctions between masculine and feminine are less likely to participate in the labour force. This relationship holds both across and within countries, even after controlling for individual characteristics, religion and proxies for gender social norms related to ones ethnicity, such as historical use of the plough. The results suggest that language has a direct effect on preferences regarding labour market decisions, above and beyond gender norms arising from ethnicity and religion. These findings contribute to the growing literature on the relationship between socio-psychological factors and gender differences in economic outcomes.
    Keywords: Language; Identity; Culture; Gender social norms; Female labour force participation ; Sapir-Whorf hypothesis
    JEL: D03 J16 N37 O55
    Date: 2016
  5. By: Fabrizio Panebianco; Thierry Verdier; Yves Zenou
    Abstract: Consider a network of firms where a firm T is given the opportunity to innovate a product (first-generation innovation). If successful, this firm can temporarily sell this innovation to her direct neighbors because this will give her access to a larger market. However, if her direct neighbors innovate themselves on top of firm T's innovation (second-generation innovations), then firm T loses the right to sell her initial innovation to the remaining firms in the market. We analyze this game where each firm (T and her direct neighbors) has to decide at which price they want to sell their innovation. We show that the optimal price policy of each firm depends on the level of property rights protection, the position of firm T in the network, her degree and the size of the market. We then analyze the welfare implications of our model where the planner that maximizes total welfare has to decide which firm to target. We show that it depends on the level of property rights protection and on the network structure in a non-trivial way. JEL classification: D85, L1, Z13. Keywords: Networks, diffusion centrality, targets, innovation.
    Date: 2016
  6. By: Sutter, Matthias (University of Cologne); Huber, Jürgen (University of Innsbruck); Kirchler, Michael (University of Innsbruck); Stefan, Matthias (University of Innsbruck)
    Abstract: Markets are ubiquitous in our daily life and, despite many imperfections, they are a great source of human welfare. Nevertheless, there is a heated recent debate on whether markets erode social responsibility and moral behavior. In fact, competitive pressure on markets may create strong incentives for unethical practices (like using child labor) to increase competitiveness. While markets have been considered as detrimental for moral behavior, it has turned out a challenging task to identify where moral behavior is reflected in a market. Recent work has suggested that falling prices in markets with externalities are an indicator of declining morals. Here we examine the relation between trading volume, prices and moral behavior by presenting an experimental study where we let buyers and sellers interact on a double auction market. In one set of treatments, concluding a trade has no externality; in the other set, there is a negative externality by voiding donations for a potentially life-saving measles vaccine to UNICEF. We find that moral behavior reveals itself in lower trading volume in markets with an externality, but that market prices are hardly different between markets with or without an externality. We also vary the number of buyers and sellers and show that prices depend mainly on the relative number of buyers and sellers, but not on the existence of an externality. Hence, the market forces of supply and demand work equally well in determining prices whether or not trading has an externality.
    Keywords: morals, markets, competition, experiment
    JEL: C92 D03 D62
    Date: 2016–07
  7. By: Chen, Daniel L.
    Abstract: Some theories about the positive impact of markets on morality suggest that competition increases empathy, not between competitors, but between them and third parties. However, empathy may be a necessary evolutionary antecedent to guile, which is when someone knows what the other person wants and intentionally deceives him or her, and deception may have evolved as a means of exploiting empathy. This paper examines how individuals primed for empathy behave towards third parties in a simple economic game of deception. It reports the results of a data entry experiment in an online labor market. Individuals enter data randomized to be a prime for empathy, for guile, or a control. Empathy is then measured using a Reading the Mind in the Eyes Test and guile is measured using a simple economic game. Individuals primed for empathy become less deceptive towards third parties. Individuals primed for guile become less likely to perceive that deceiving an individual is unfair in a vignette. These results are robust to a variety of controls and to restricting to workers who entered the prime accurately. These findings are inconsistent with the hypothesis that empathy causes guile and suggests that empathy may cause those who are making judgements to become less deceptive.
    Keywords: Normative Commitments, Other-Regarding Preferences, Empathy, Deception, Guile
    JEL: D03 D64 K00
    Date: 2016–07
  8. By: Ekaterina V. Krekhovets (National Research University Higher School of Economics); Liudmila A. Leonova (National Research University Higher School of Economics)
    Abstract: Student friendship networks can be considered as social capital, which is known to be a very useful resource during university and after it. Several empirical studies have examined static models of student behaviour in social networks. In this study we analyse the dynamic changes of student social connections. We use original longitude data of student social ties from one Russian university. Data was collected within the framework of a research project of the International Research Laboratory for Institutional Analysis of Economic Reforms. To investigate factors influencing the evolution of social ties during university probit regressions were tested. We found that students with similar characteristics such as gender and academic achievement are more likely to become friends and continue to be friends. Both studying in the same group and living in a dormitory increase the likelihood of being friends. We also found a transitivity effect. We observe a positive effect of having common friend on friendship ties. We also notice a positive link between reciprocity and friendship stability.
    Keywords: social networks, friendship, higher education
    JEL: D85 I21 I23
    Date: 2016
  9. By: Méon, Pierre-Guillaume (Free University of Brussels); Tojerow, Ilan (Free University of Brussels)
    Abstract: We study the relationship between major religious denominations and individuals' levels of education, using the World Values Survey. In a first step, running country-by-country regressions, we report first-time evidence that no single denomination has a universal effect on education. Each denomination has a positive and statistically significant effect in some countries, a negative and statistically significant effect in others, and a statistically insignificant effect elsewhere. In a second step, we relate the sign of the impact of a denomination in a country to whether the denomination is a minority in that country. We find that denominations that are a minority in a country are more likely to be associated with a higher level of education, and less likely to be associated with a lower level of education in that country. In both steps, the findings are independent from the specification of the regressions used in the first stage to determine the sign of the impact of denominations on educational outcomes. The finding of the second step is moreover robust to defining minority denominations using various thresholds. It is robust to controlling for whether the denomination is a state religion, for the country's level of democracy, per capita GDP, or level of education, to introducing denomination- and country- fixed effects, and to controlling for the identity of the largest other denomination in the country.
    Keywords: religion, education, minority
    JEL: I2 O5 Z1
    Date: 2016–07
  10. By: Xiaochuan Huang (DT Capital Management Co., Ltd.); Takehito Masuda (Institute of Economic Research, Kyoto University); Yoshitaka Okano (School of Economics and Management, Kochi University of Technology); Tatsuyoshi Saijo (School of Economics and Management, Kochi University of Technology)
    Abstract: We experimentally test a two-stage mechanism called the stay-leave mechanism to achieve cooperation in n-plyer prisoner's dilemma situations. Under this mechanism, each cooperator has the chance to revise his choice when players' choices are not unanimous. We say a player is selfish if he eliminates dominated choices in each stage. If all participants of the stay-leave mechanism are selfish, for any value of public good benefit that arises, the unique equilibrium is unanimous cooperation. The average cooperation rate in the stay-leave mechanism experiment averaged 86.6% across 15 periods, with an upward trend, increasing to 96.0% after period 5. By examining earlier period data, we detected that selfish and conditionally cooperative subjects coexist at a proportion of approximately 3:1. Finally, we extended our model to incorporate a mixture of the observed two types and misbeliefs about others' types. Paradoxically, unanimous cooperation is less likely to occur as the number of conditionally cooperative players increase. The model also partially explains the observed upward trend in the cooperation rate in the stay-leave mechanism sessions.
    Keywords: social dilemma; experiment; conditional cooperator; behavioral heterogeneity
    JEL: C72 C72 D74 H41 P43
    Date: 2016–07
  11. By: Adamopoulou, Effrosyni (Efi) (Bank of Italy); Kaya, Ezgi (Cardiff University)
    Abstract: This paper studies the impact of peer behavior on living arrangements of young adults in the U.S. Using data from the National Longitudinal Study of Adolescent Health (Add Health) we analyze the influence of high school friends on the nest-leaving decision of young adults. We achieve identification by exploiting the differences in the timing of leaving the parental home among peers, the individual-specific nature of the peer groups that are based on friendship nominations, and by including school (network) and grade (cohort) fixed effects. Our results indicate that there are statistically significant peer effects on the decision of young adults to leave parental home. This is true even after we control for labor and housing market conditions and for a comprehensive list of individual and family-of-origin characteristics that are usually unobserved by the econometrician. We discuss various mechanisms and we confirm the robustness of our results through a placebo exercise. Our findings reconcile with the increasing fraction of young adults living with their parents that is persisting in the U.S. even after the end of the Great Recession.
    Keywords: peer effects, friends, living arrangements, leaving parental home
    JEL: D10 J12 J60 Z13
    Date: 2016–07

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