nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2017‒03‒05
seven papers chosen by
Fabio Sabatini
Università degli Studi di Roma “La Sapienza”

  1. Keeping It in the Family: Lineage Organization and the Scope of Trust in Sub-Saharan Africa By Jacob Moscona; Nathan Nunn; James A. Robinson
  2. Governance Structures and Trust: a Study of Real Estate Networks By Boaventura, Joao Mauricio; Carnaúba, A.A.C.; Todeva, Emanuela; Azevedo, A.C.; Armando, Eduardo
  3. Signaling Cooperation By Heinz, Matthias; Schumacher, Heiner
  4. Reciprocity and honesty in capital budgeting: Positive spill-over effects of reporting By Ostermaier, Andreas
  5. When do the poor vote for the right-wing and why: Status inequality and vote choice in the Indian states By Pavithra Suryanarayan
  6. An Economic Theory of Religious Belief By Strulik, Holger
  7. Connecting the Young: high school graduates' matching to first jobs in booms and great recessions By Hensvik, Lena; Müller, Dagmar; Nordström Skans, Oskar

  1. By: Jacob Moscona; Nathan Nunn; James A. Robinson
    Abstract: We present evidence that the traditional structure of society is an important determinant of the scope of trust today. Within Africa, individuals belonging to ethnic groups that organized society using segmentary lineages exhibit a more limited scope of trust, measured by the gap between trust in relatives and trust in non-relatives. This trust gap arises because of lower levels of trust in non-relatives and not higher levels of trust in relatives. A causal interpretation of these correlations is supported by the fact that the effects are primarily found in rural areas where these forms of organization are still prevalent.
    JEL: N00 O10 Z1 Z13
    Date: 2017–02
  2. By: Boaventura, Joao Mauricio; Carnaúba, A.A.C.; Todeva, Emanuela; Azevedo, A.C.; Armando, Eduardo
    Abstract: The present study aimed at verifying how different modes of governance structure are linked to different levels of interorganisational trust. Its theoretical grounding involves Transaction Cost Theory, which studies governance of interorganisational arrangements and research on trust in the business field. A descriptive and quantitative approach has been adopted to describe the relation between trust amongst business network participants and the mode of governance adopted by the surveyed networks. Hence, a detailed questionnaire has been employed, which was answered by 35 real estate agency managers, whose participation was directly linked to 11 business networks. By using Spearman methods of identification of non-parametric correlation and correspondence analysis, it was possible to verify that certain modes of governance structure associate with different levels of trust. Considering the scarcity of quantitative research on the theme, this paper contributes to the field by presenting results which point out that collectively-managed governance of regional cooperation networks is linked to high levels of trust; whereas governance of dispersed networks with the presence of a lead company are linked to low levels of trust. Medium levels of trust were observed in networks governed by an administrative organisation. Considering the practical aspect of administration in networks, one can conclude that the process of governance structure in such interorganisational arrangements should include deliberations about the influence of the adopted mode of governance on trust amongst participants. The paper does not allow generalizations of its conclusions beyond its chosen sample.
    Keywords: Brazil; competitiveness; governance structure; real estate networks; dimensions of trust
    JEL: M1
    Date: 2016
  3. By: Heinz, Matthias; Schumacher, Heiner
    Abstract: We examine what an applicant’s vita signals to potential employers about her willingness to cooperate in teams. Intensive social engagement may credibly reveal that an applicant cares about the well‐being of others and therefore is less likely to free‐ride in teamwork situations. We find that contributions in a public goods game strongly increase in a subject’s degree of social engagement as indicated on her résumé (and rated by an independent third party). Engagement in other domains, such as student or sports associations, is not positively correlated with contributions. In a prediction experiment with human resource managers from various industries, we find that managers use résumé content effectively to predict relative differences in subjects’ willingness to cooperate. Thus, young professionals signal important behavioral characteristics to potential employers through the choice of their extracurricular activities.
    JEL: C72 C92 D82
    Date: 2016
  4. By: Ostermaier, Andreas
    Abstract: Capital rationing and reporting are often combined to allocate resources in firms. Trust in managers' honest reports and distrustful control create an interesting tension. How do managers respond to this ambivalence of trust and control? We develop an analytical model to predict, first, that managers reciprocate distrust; they misreport heavily so as to sabotage profitable investments. Second, reporting reduces in turn sabotage because managers are reluctant to lie. Third, honesty spills over, in addition, to inhibit managers' reciprocity. Evidence from a laboratory experiment supports our predictions. Our study ties capital rationing and reporting to the psychological factors of reciprocity and honesty and helps us understand their effects in budgeting. From a managerial viewpoint, the value of reporting, even in combination with capital rationing, may be as interesting to see as how sabotage further exacerbates the underinvestment which is known to arise from capital rationing.
    JEL: D03 G31 M41
    Date: 2016
  5. By: Pavithra Suryanarayan
    Abstract: What explains the popularity of right-wing parties amongst the poor? This paper argues that in hierarchical societies with high social-status inequality, poor high-status voters may ally with rich high-status voters if they believe their social-status is under threat. I demonstrate this in the context of the Indian states by exploiting an announcement by the Government of India in 1990 to implement affirmative action for lower castes—an intervention that threatened to weaken the social-status of upper-caste Brahmans. Using unique data from the 1931 census, this paper shows that areas where Brahmans were more dominant in the 1930s experienced a higher surge in rightwing voting after this announcement than other areas. Using survey data, I find that both wealthy and poor Brahmans voted for the right-wing where Brahmans were dominant in 1931. The paper shows how concerns about social-status may make the poor open to appeals by anti-redistribution parties.
    Date: 2017
  6. By: Strulik, Holger
    Abstract: In this paper I consider how individuals allocate their time between church attendance (and other religious activities) and secular leisure activities. Moreover individuals use a cognitive style, which is either intuitive-believing or reflective-analytical. I assume that the full benefit from religious activities is achieved by intuitive believers. The model predicts that, ceteris paribus, wealthier individuals and individuals with higher cognitive ability are more likely to abandon the intuitive-believing cognitive style. They may continue to attend church but do so less frequently than intuitive believers. In general equilibrium, there exists a locally stable steady state where believing and frequent church attendance is widespread across the social strata. A sufficiently large negative shock (e.g. the Enlightenment, repeal of Sunday shopping laws), however, initiates the gradual secularization of society.
    JEL: N30 D11 Z12
    Date: 2016
  7. By: Hensvik, Lena (IFAU - Institute for Evaluation of Labour Market and Education Policy); Müller, Dagmar (IFAU, Uppsala university and UCLS); Nordström Skans, Oskar (Uppsala university, IFAU, UCLS and IZA)
    Abstract: Using Swedish economy-wide data spanning across two deep recessions, we examine the relationship between labor market conditions and the role of social contacts in matching labor market entrants to employing firms. We use class-plant fixed-effects models to isolate the role of social contacts from paid work during high-school. One third of post-graduation matches are formed at establishments where youths worked during their studies. Furthermore, graduates are much more likely to match with sites to which adult coworkers from these jobs have relocated. These patterns are strikingly counter-cyclical. Contacts are much more important for job matching in deep recessions than in good times, suggesting that informal contacts and social networks are crucial determinants of matching patterns in bad times.
    Keywords: job matching; social Contacts; business cycle; young workers
    JEL: J01
    Date: 2017–02–23

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