nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2018‒03‒26
twelve papers chosen by
Fabio Sabatini
Università degli Studi di Roma “La Sapienza”

  1. Growing Up in a War: The Shaping of Trust and Identity After Conflict in Peru By Edgar Salgado Chavez
  2. Individual Social Capital and Migration By Julie L. Hotchkiss; Anil Rupasingha
  3. Recovering Social Networks from Panel Data: Identification, Simulations and an Application By Áureo de Paula; Imran Rasul; Pedro Souza
  4. Kinship Systems, Cooperation, and the Evolution of Culture By Benjamin Enke
  5. Explaining the Impact of Formal Institutions on Social Trust: A Psychological Approach By Tamilina, Larysa; Tamilina, Natalya
  6. Trust as a Skill: Applying Psychological Models of Skill Acquisition to Explain the Social Trust Formation Process By Tamilina, Larysa; Tamilina, Natalya
  7. Corruption and personnel selection and allocation in the public sector By Sauro Mocetti; Tommaso Orlando
  8. Social Interactions, Mechanisms, and Equilibrium: Evidence from a Model of Study Time and Academic Achievement By Tim Conley; Nirav Mehta; Ralph Stinebrickner; Todd Stinebrickner
  9. Denial and Alarmism in Collective Action Problems By Manuel Foerster; Joel (J.J.) van der Weele
  10. Distrust in Experts and the Origins of Disagreement By Alice Hsiaw; Ing-Haw Cheng
  11. Religiosity, attitude and the demand for socially responsible products By Graafland, Johan
  12. The labor market integration of refugees to the United States: Do entrepreneurs in the network help? By Dagnelie, Olivier; Mayda, Anna Maria; Maystadt, Jean-François

  1. By: Edgar Salgado Chavez (Department of Economics, University of Sussex)
    Abstract: This paper evaluates the effect of conflict over the formation of trust and identity. It finds that Peruvian individuals exposed to violent events during their impressionable years trust less government institutions, and feel less identified with their neighbors, while more identified with religious groups. The effect on identification is heterogeneous by the indigenous origin of the individuals. Individuals who own an agricultural plot embedded in a communal arrangement at the local level exhibit even smaller levels of identification with their local neighbours while higher levels of identification with their ethnic group. In line with recent literature, these findings suggest that conflict has a small but persistent effect on the formation of trust and identity, which is a central feature to understand the interaction between culture and institutions, and ultimately to understand the persistent consequences of wars.
    Keywords: beliefs; conflict; identity
    JEL: D74 N16 P26
    Date: 2018–03
  2. By: Julie L. Hotchkiss; Anil Rupasingha
    Abstract: This paper determines how individual, relative to community social capital affects individual migration decisions. We make use of non-public data from the Social Capital Community Benchmark Survey to predict multi-dimensional social capital for observations in the Current Population Survey. We find evidence that individuals are much less likely to have moved to a community with average social capital levels lower than their own and that higher levels of community social capital act as positive pull-factor amenities. The importance of that amenity differs across urban/rural locations. We also confirm that higher individual social capital is a negative predictor of migration.
    Keywords: social capital, migration, Current Population Survey, amenities, non-public data, factor analysis
    JEL: R23 D71 C36 C38
    Date: 2018–03
  3. By: Áureo de Paula (University College London); Imran Rasul (University College of London); Pedro Souza (PUC-Rio)
    Abstract: It is almost self-evident that social interactions can determine economic behavior and outcomes. Yet, information on social ties does not exist in most publicly available and widely used datasets. We present methods to recover information on the entire structure of social networks from observational panel data that contains no information on social ties between individuals. In the context of a canonical social interactions model, we provide sufficient conditions under which the social interactions matrix, endogenous and exogenous social effect parameters are all globally identified. We describe how high dimensional estimation techniques can be used to estimate the model based on the Adaptive Elastic Net GMM method. We showcase our method in Monte Carlo simulations using two stylized and two real world network structures. Finally, we employ our method to study tax competition across US states. We find the identified network structure of tax competition differs markedly from the common assumption of tax competition between geographically neighboring states. We analyze the identified social interactions matrix to provide novel insights into the long-standing debate on the relative roles of factor mobility and yardstick competition in driving tax setting behavior across states. Most broadly, our method shows how the analysis of social interactions can be usefully extended to economic realms where no network data exists.
    Keywords: social interactions, panel data, high dimensional estimation, GMM, adaptive elastic net
    JEL: C18 C31 D85 H71
    Date: 2018–03
  4. By: Benjamin Enke
    Abstract: An influential body of psychological and anthropological theories holds that societies exhibit heterogeneous cooperation systems that differ both in their level of in-group favoritism and in the tools that they employ to enforce cooperative behavior. According to some of these theories, entire bundles of functional psychological adaptations – religious beliefs, moral values, negative reciprocity, emotions, and social norms – serve as “psychological police officer” in different cooperation regimes. This paper uses an anthropological measure of the tightness of historical kinship systems to study the structure of cooperation patterns and enforcement devices across historical ethnicities, contemporary countries, ethnicities within countries, and among migrants. The results document that societies with loose ancestral kinship ties cooperate and trust broadly, which appears to be enforced through a belief in moralizing gods, individualizing moral values, internalized guilt, altruistic punishment, and large-scale institutions. Societies with a historically tightly knit kinship structure, on the other hand, cheat on and distrust the out-group but readily support in-group members in need. This cooperation regime in turn is enforced by communal moral values, emotions of external shame, revenge-taking, and local governance structures including strong social norms. These patterns suggest that various seemingly unrelated aspects of culture are all functional and ultimately serve the same purpose of regulating economic behavior.
    Keywords: Kinship, culture, cooperation, enforcement devices
    JEL: D00 O10
    Date: 2018
  5. By: Tamilina, Larysa; Tamilina, Natalya
    Abstract: By drawing on psychological models of action choice, this study distinguishes between four key factors that determine trust building: (1) knowledge to trust, (2) others-regarding, (3) cognition, and (4) contexts. These four factors are combined into a single analytical framework that is used for establishing channels through which the institutional context impacts social trust formation. Our theoretical and empirical evidence suggests that context is the strongest determinant of trust, with its overall effect being, however, modified by the degree to which the individual’s knowledge of trusting, cognition, and others-regarding are developed. The Programme for the International Assessment of Adult Competencies (PIAAC) data from the year 2012 are utilised for testing our propositions.
    Keywords: Social trust, trust formation, formal institutions, action choice, multi-level analysis
    JEL: D20 Z10 Z13
    Date: 2017–01–01
  6. By: Tamilina, Larysa; Tamilina, Natalya
    Abstract: This study uses psychological models of skill acquisition to explain how social trust is formed. We view trust as being shaped by four factors: crystallized, cognitive, contact, and context. We combine these four factors into a 4C-component analytical model by establishing links between them and explaining the rationale behind their individual and joint effects on trust. The proposed model is tested with the PIAAC public-use data. Both theoretical and empirical elaborations suggest that context is the strongest driver of trust formation. Good contexts also spur more trust when individuals already possess crystallized knowledge and can display faith in others. Such knowledge can be learned if it is missing, but how efficiently depends on the quality of one’s cognitive system, frequency of contacts with others, and the distance between one’s actual knowledge of trust and the optimal trust level for the given context.
    Keywords: social trust; trust formation; psychology of skill acquisition; PIAAC
    JEL: Z10 Z13
    Date: 2017–01–01
  7. By: Sauro Mocetti (Bank of Italy); Tommaso Orlando (Bank of Italy)
    Abstract: We construct local-level statistical indicators of corruption based on the number of reported crimes, on citizens’ trust in local public institutions, on perceptions of administrations’ integrity and on the quality of public expenditure and we examine the impact that the presence of corruption, as measured by these indicators, has on personnel selection and allocation in the public sector. Using a difference-in-differences estimation strategy on Italian data, we find that the selection of public employees in terms of human capital worsens in comparison to that of their private sector counterparts in areas with higher levels of our corruption indicators. This effect is mainly observed among managers and highly qualified professionals. Moreover, corruption indicators are associated with the misallocation of human resources and, in particular, with an increase in the rate of under-qualification among public sector employees compared with the private sector. These results are robust to various indicators of corruption and to several robustness checks, including IV estimation that uses historical factors as an exogenous source of variation for current corruption.
    Keywords: corruption, selection, mismatch, schooling, ability, public employment
    JEL: D73 J45
    Date: 2017–10
  8. By: Tim Conley; Nirav Mehta; Ralph Stinebrickner; Todd Stinebrickner
    Abstract: We develop and estimate a model of student study time on a social network. The model is designed to exploit unique data collected in the Berea Panel Study. Study time data allow us to quantify an intuitive mechanism for academic social interactions: own study time may depend on friend study time in a heterogeneous manner. Social network data allow us to embed study time and resulting academic achievement in an estimable equilibrium framework. We develop a specification test that exploits the equilibrium nature of social interactions and use it to show that novel study propensity measures mitigate econometric endogeneity concerns.
    Keywords: social networks, peer effects, homophily, time-use
    JEL: C52 C54 I20
    Date: 2018
  9. By: Manuel Foerster (University of Hamburg); Joel (J.J.) van der Weele (Universiteit van Amsterdam)
    Abstract: We analyze communication about the social returns to investment in a public good. We model two agents who have private information about these returns as well as their own taste for cooperation, or social preferences. Before deciding to contribute or not, each agent submits an unverifiable report about the returns to the other agent. We show that even if the public good benefits both agents, there are incentives to misrepresent information. First, others’ willingness to cooperate generates an incentive for “alarmism”, the exaggeration of social returns in order to opportunistically induce more investment. Second, if people also want to be perceived as cooperators, a “justification motive” arises for low contributors. As a result, equilibrium communication features “denial” about the returns, depressing contributions. We illustrate the model in the context of institutional inertia and the climate change debate.
    Keywords: cheap talk; cooperation; image concerns; information aggregation; public goods
    JEL: C72 D64 D82 D83 D91
    Date: 2018–03–07
  10. By: Alice Hsiaw (Brandeis University); Ing-Haw Cheng (Brandeis University)
    Abstract: Disagreement about the state of the world and expert credibility often go together in areas such as economics, climate change, and medicine. We argue this occurs because individuals make a mistake we call pre-screening when determining how much weight give an expert's signals. A pre-screener mistakes credibility as a primitive of the model and uses the signals to learn about credibility before forming posterior beliefs. Pre-screening predicts that disagreement about credibility is correlated with disagreement about the state. Furthermore: 1) Differing first impressions about credibility create persistent disagreement about the state; 2) Encountering experts in different order generates disagreement; and 3) Confirmation bias, overconfidence, and their opposites endogenously arise. These effects arise even when individuals share common priors, information, and learning errors, providing a theory of the origins of disagreement.
    Keywords: disagreement, polarization, learning, expectations, experts
    Date: 2016–10
  11. By: Graafland, Johan (Tilburg University, School of Economics and Management)
    Abstract: In this paper, we examine the relationship between various Christian denominations and attitude and behavior regarding consumption of socially responsible (SR) products. Literature on the relationship between religiosity and pro-social behavior has shown that religiosity strengthens positive attitudes towards pro-social behavior, but does not affect social behavior itself. This seems to contradict the theory of planned behavior that predicts that attitude fosters behavior. One would therefore expect that if religiosity encourages attitude towards SR products, it would also increase the demand for them. We test this hypothesis for four affiliations (non-religious, Catholic, Orthodox Protestant, and Other Protestant) on a sample of 997 Dutch consumers, using structural equation modeling. We find that Christian religiosity, indeed, increases positive attitude towards SR products, except for the Orthodox Protestant affiliation. In accordance with the theory of planned behavior, attitude is found to increase the demand for SR products. We find no evidence of hypocrisy (in the sense that religiosity increases pro-social attitude without affecting behavior in the case of SR products) for any of the Christian denominations.
    Date: 2017
  12. By: Dagnelie, Olivier; Mayda, Anna Maria; Maystadt, Jean-François
    Abstract: We investigate whether entrepreneurs in the network of refugees - from the same country of origin - help refugees' labor-market integration by hiring them in their businesses. We analyze the universe of refugee cases without U.S. ties who were resettled in the United States between 2005 and 2010. We address threats to identification due to sorting of refugees into specific labor markets and to strategic placement by resettlement agencies. We find that the probability that refugees are employed 90 days after arrival is positively affected by the number of business owners in their network, but negatively affected by the number of those who are employees. This suggests that network members who are entrepreneurs hire refugees in their business, while network members working as employees compete with them, consistent with refugees complementing the former and substituting for the latter.
    Keywords: entrepreneurship; labor market integration; Refugees
    JEL: F22 J61
    Date: 2018–02

This nep-soc issue is ©2018 by Fabio Sabatini. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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