nep-soc New Economics Papers
on Social Norms and Social Capital
Issue of 2019‒02‒11
thirteen papers chosen by
Fabio Sabatini
Università degli Studi di Roma “La Sapienza”

  1. Broadband Internet and Social Capital By Andrea Geraci; Mattia Nardotto; Tommaso Reggiani; Fabio Sabatini
  2. The Effects of Status Mobility and Group Identity on Trust By Suchon, Rémi; Villeval, Marie Claire
  3. The Welfare Effects of Social Media By Hunt Allcott; Luca Braghieri; Sarah Eichmeyer; Matthew Gentzkow
  4. Trends in the Diffusion of Misinformation on Social Media By Hunt Allcott; Matthew Gentzkow; Chuan Yu
  5. Vaccine Hesitancy and Fake News: Quasi-experimental Evidence from Italy By Carrieri, V.;; Madio, L.;; Principe, F.;
  6. Social interactions in health behaviors and conditions By Ana Balsa; Carlos Díaz
  7. Crumbling morals? An experimental study on how a social framing can affect embezzlement By Nina Lucia Stephan
  8. Economic Development, Inequality and Generalized Trust By Kyriacou, Andreas; Trivin, Pedro
  9. Market And Network Corruption By Maria Kravtsova; Aleksey Oshchepkov
  10. Those Who Stayed: Individualism, Self-Selection and Cultural Change during the Age of Mass Migration By Anne Sofie Beck Knudsen
  11. Immigrant Innovators and Firm Performance By Fornaro, Paolo; Maliranta, Mika; Rouvinen, Petri
  12. Tolerance and Compromise in Social Networks By Garance Genicot
  13. Professional networks and their coevolution with executive careers: Evidence from North America and Europe By Berardi, Nicoletta; Lalanne, Marie; Seabright, Paul

  1. By: Andrea Geraci (European Commission JRC); Mattia Nardotto (KU Leuven); Tommaso Reggiani (Masaryk University); Fabio Sabatini (Sapienza University of Rome)
    Abstract: We study how the diffusion of broadband Internet affects social capital using two data sets from the UK. Our empirical strategy exploits the fact that broadband access has long depended on customers’ position in the voice telecommunication infrastructure that was designed in the 1930s. The actual speed of an Internet connection, in fact, rapidly decays with the distance of the dwelling from the specific node of the network serving its area. Merging unique information about the topology of the voice network with geocoded longitudinal data about individual social capital, we show that access to broadband Internet caused a significant decline in forms of offline interaction and civic engagement. Overall, our results suggest that broadband penetration substantially crowded out several aspects of social capital.
    Keywords: ICT, broadband infrastructure, networks, Internet, social capital, civic capital
    JEL: C91 D9 D91 Z1
    Date: 2018–12
  2. By: Suchon, Rémi (University of Lyon 2); Villeval, Marie Claire (CNRS, GATE)
    Abstract: In a laboratory experiment we test the interaction effects of status and group identity on interpersonal trust. Natural group identity is generated by school affiliation. Status (expert or agent) is awarded based on relative performance in a math quiz that is ex ante less favorable to the subjects from one group. We find that "promoted" trustors (individuals from the disadvantaged group that nevertheless achieve the status of expert) trust less both in-group and out-group trustees, compared to the other members of their group. Rather than playing against the effects of natural group identity, status promotion singles-out individuals. In contrast, trustworthiness is not affected by status and there is no evidence that interacting with promoted individuals impacts trust or trustworthiness.
    Keywords: trust, status, group identity, social mobility, experiment
    JEL: C92 D91 J62
    Date: 2019–01
  3. By: Hunt Allcott; Luca Braghieri; Sarah Eichmeyer; Matthew Gentzkow
    Abstract: The rise of social media has provoked both optimism about potential societal benefits and concern about harms such as addiction, depression, and political polarization. We present a randomized evaluation of the welfare effects of Facebook, focusing on US users in the run-up to the 2018 midterm election. We measured the willingness-to-accept of 2,844 Facebook users to deactivate their Facebook accounts for four weeks, then randomly assigned a subset to actually do so in a way that we verified. Using a suite of outcomes from both surveys and direct measurement, we show that Facebook deactivation (i) reduced online activity, including other social media, while increasing offline activities such as watching TV alone and socializing with family and friends; (ii) reduced both factual news knowledge and political polarization; (iii) increased subjective well-being; and (iv) caused a large persistent reduction in Facebook use after the experiment. We use participants' pre-experiment and post-experiment Facebook valuations to quantify the extent to which factors such as projection bias might cause people to overvalue Facebook, finding that the magnitude of any such biases is likely minor relative to the large consumer surplus that Facebook generates.
    JEL: D12 D90 I31 L86 O33
    Date: 2019–01
  4. By: Hunt Allcott; Matthew Gentzkow; Chuan Yu
    Abstract: In recent years, there has been widespread concern that misinformation on social media is damaging societies and democratic institutions. In response, social media platforms have announced actions to limit the spread of false content. We measure trends in the diffusion of content from 569 fake news websites and 9,540 fake news stories on Facebook and Twitter between January 2015 and July 2018. User interactions with false content rose steadily on both Facebook and Twitter through the end of 2016. Since then, however, interactions with false content have fallen sharply on Facebook while continuing to rise on Twitter, with the ratio of Facebook engagements to Twitter shares decreasing by 60 percent. In comparison, interactions with other news, business, or culture sites have followed similar trends on both platforms. Our results suggest that the relative magnitude of the misinformation problem on Facebook has declined since its peak.
    JEL: L0 L82 P16
    Date: 2019–01
  5. By: Carrieri, V.;; Madio, L.;; Principe, F.;
    Abstract: The spread of fake news and misinformation on social media is blamed to be one of the main causes of vaccine hesitancy, one of the ten threats to global health according to World Health Organization. This paper studies the effect of diffusion of fake news on immunization rates in Italy by exploiting a quasi-experiment occurred in 2012, when the Court of Rimini officially recognized a causal link between MMR vaccine and autism and awarded injury compensation. To this end, we exploit virality of fake news following the 2012 Italian Court’s ruling along with the intensity in the exposure to non-traditional media driven by regional infrastructural differences in Internet broadband coverage. Using a Difference-in-Difference (DiD) regression on regional panel data, we show that the spread of fake news caused a drop in children immunization rates for all types of vaccines.
    Keywords: fake news; vaccine hesitancy; children immunization rates, social media, internet;
    JEL: I12 I18 L82 L86
    Date: 2019–02
  6. By: Ana Balsa; Carlos Díaz
    Abstract: We review the economic literature of the past 20 years on peer effects in health behaviors and conditions. We find consistent evidence of peer effects across a wide range of behaviors and outcomes (alcohol, body weight, food and nutrition, physical fitness, sexual behaviors, fertility, and mental health use) and across a diverse set of identification techniques (instrumental variables, network analysis, reduced form models, random assignment of peers, and discrete choice models of endogenous interactions). Despite the thorough evidence on the existence of peer effects, we still know little about the underlying mechanisms. Understanding these mechanisms is critical for the design of effective policies and constitutes the new stage in the research agenda.
    Keywords: Peer effects, social interactions, peer influence, health behaviors, health conditions, systematic review, substance use, obesity, sexual behavior, mental health
    Date: 2018
  7. By: Nina Lucia Stephan (Paderborn University)
    Abstract: With data from a laboratory experiment we show that the interpersonal experience can either encourage or reduce subsequent immoral decision-making; in this case the immoral decision to engage in embezzlement. In the experiment, subjects first received initial endowments, either as a share from a previous dictator (social framing treatment) or by random determination (neutral framing treatment). Next, subjects could increase their payoff by embezzling, i.e. taking away part of a donation that they are entrusted with, before forwarding the rest. We find that after receiving a less-than-half share in the social framing treatment, in comparison to receiving an equally large amount in the neutral framing treatment, subjects are significantly more likely to embezzle. Thus, depending on the height of endowment, the social framing encourages forfeiting moral behavior. We argue that this effect is driven by self-deception: observing the dictator's decision to share less than half facilitates excusing one's own immoral choice. We conclude that socially framing a moral decision situation, even though this may remind individuals of what is socially acceptable, does not have an unanimously beneficial effect on the moral decision to embezzle.
    Keywords: social framing, donations, immoral behavior, embezzlement, experimental economics
    JEL: C91 D91 D63
    Date: 2019–01
  8. By: Kyriacou, Andreas; Trivin, Pedro
    Abstract: We argue that the positive impact of economic development on generalized trust is likely to be undermined by income inequality. Our empirical evidence, based on a panel of up to 89 countries, provides robust support for this assertion.
    Keywords: development, income inequality, generalized trust, panel data
    JEL: D31 O15 Z13
    Date: 2018–11–05
  9. By: Maria Kravtsova (National Research University Higher School of Economics); Aleksey Oshchepkov (National Research University Higher School of Economics)
    Abstract: Economists tend to reduce all corruption to impersonal market-like transactions, ignoring the role of social ties in shaping corruption. In this paper, we show that this simplification substantially limits the understanding of corruption. We distinguish between market corruption (impersonal bribery), and network (or parochial) corruption which is conditional on the social connections between bureaucrats and private agents. We argue, both theoretically and empirically, that these types of corruption have different qualities. Using data from the Life in Transition Survey (LiTS) which covers all post-socialist countries we show, first, that the correlation between market and network corruption is weak, which implies that ignoring network corruption leads not only to an underestimation of the overall scale of corruption but also biases national corruption rankings. Secondly, in line with theoretical expectations, we find that network corruption is more persistent over time, less related to contemporary national socio-economic and institutional characteristics and has stronger historical roots than market corruption. Yet, network corruption, unlike bribery, is not able to ‘grease the wheels’ and is not associated with political instability. Lastly, we show that the decline in bribery which was observed in almost all post-socialist countries in the period from 2010 to 2016 was accompanied by rising network corruption in many of them, which has important policy implications
    Keywords: market corruption, parochial corruption, network corruption, blat, bribery, post-socialist countries
    JEL: D73 Z13 L26
    Date: 2019
  10. By: Anne Sofie Beck Knudsen (Department of Economics, University of Copenhagen, Denmark)
    Abstract: This paper examines the joint evolution of emigration and individualism in Scandinavia during the Age of Mass Migration (1850-1920). A long-standing hypothesis holds that people of a stronger individualistic mindset are more likely to migrate as they suffer lower costs of abandoning existing social networks. Building on this hypothesis, I propose a theory of cultural change where migrant self-selection generates a relative push away from individualism, and towards collectivism, in migrantsending locations through a combination of initial distributional e¤ects and channels of intergenerational cultural transmission. Due to the interdependent relationship between emigration and individualism, emigration is furthermore associated with cultural convergence across subnational locations. I combine various sources of empirical data, including historical population census records and passenger lists of emigrants, and test the relevant elements of the proposed theory at the individual and subnational district level, and in the short and long run. Together, the empirical results suggest that individualists were more likely to migrate than collectivists, and that the Scandinavian countries would have been considerably more individualistic and culturally diverse, had emigration not taken place.
    Keywords: Culture, individualism, migration, selection, economic history
    JEL: Z10 F22 O15 R23 N33
    Date: 2019–01–23
  11. By: Fornaro, Paolo; Maliranta, Mika; Rouvinen, Petri
    Abstract: Abstract We study immigrants’ effects on firm-level innovativeness. Managers, innovators, and other employees are considered as separate groups both in firm employment and in local areas. For each, we estimate the effects of foreignness, the share of immigrants in each group, and diversity, while controlling for an extensive set of employment and other firm characteristics. Pooled cross-section estimates suggest that a higher initial share of immigrant innovators is associated with a subsequently higher probability of a product innovation; the reverse holds for process innovation. In other words, product innovation benefits from a wider spectrum of innovator perspectives brought about by foreign influence, while process innovation suffers from it. The estimated effect for product innovation is modestly large but nevertheless indicates that a host of other covariates besides immigration are important for innovation. When measured by a fractionalization index, diversity among innovators does not promote product innovation. However, culturally the closest groups of migrants have a positive effect, when considered independently. Thus, in our interpretation, diversity does offer some benefits, provided that enough cultural homogeneity of the group is retained.
    Keywords: Immigration, Ethnicity, Diversity, Innovation, Knowledge production function, Finland
    JEL: D22 F22 J61 O31
    Date: 2019–02–01
  12. By: Garance Genicot
    Abstract: In this paper, individuals are characterized by their identity — an ideal code of conduct — and by a level of tolerance for behaviors that differ from their own ideal. Individuals first choose their behavior, then form social networks. This paper studies the possibility of compromise, i.e. individuals choosing a behavior different from their ideal point, in order to be accepted by others, to "belong.'' I first show that when tolerance levels are the same in society, compromise is impossible: individuals all choose their preferred behavior and form friendships only with others whose ideal point belong to their tolerance window. In contrast, I show that heterogeneity in tolerance allows for compromise in equilibrium. Moreover, if identity and tolerance are independently distributed, any equilibrium involves some compromise.
    JEL: D85 L14 O12 Z13
    Date: 2019–01
  13. By: Berardi, Nicoletta; Lalanne, Marie; Seabright, Paul
    Abstract: This paper examines how networks of professional contacts contribute to the development of the careers of executives of North American and European companies. We build a dynamic model of career progression in which career moves may both depend upon existing networks and contribute to the development of future networks. We test the theory on an original dataset of nearly 73 000 executives in over 10 000 firms. In principle professional networks could be relevant both because they are rewarded by the employer and because they facilitate job mobility. Our econometric analysis suggests that, although there is a substantial positive correlation between network size and executive compensation, with an elasticity of around 20%, almost all of this is due to unobserved individual characteristics. The true causal impact of networks on compensation is closer to an elasticity of 1 or 2% on average, all of this due to enhanced probability of moving to a higher-paid job. And there appear to be strongly diminishing returns to network size.
    Keywords: professional networks,labor mobility,executive compensation
    JEL: D85 J31 J62 M12
    Date: 2018

This nep-soc issue is ©2019 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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