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on Social Norms and Social Capital |
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Issue of 2024‒06‒10
five papers chosen by Fabio Sabatini, Università degli Studi di Roma “La Sapienza” |
| By: | Ugo Bolletta; Paolo Pin |
| Abstract: | Polarization is a well-documented phenomenon across a wide range of social issues. However, prevailing theories often compartmentalize the examination of herding behavior and opinion convergence within different contexts. In this study, we delve into the micro-foundations of how individuals strategically select reference groups, offering insight into a dynamic process where both individual opinions and the network evolve simultaneously. We base our model on two parameters: people's direct benefit from connections and their adaptability in adjusting their opinions. Our research highlights which conditions impede the network from achieving complete connectivity, resulting in enduring polarization. Notably, our model also reveals that polarization can transiently emerge during the transition towards consensus. We explore the connection between these scenarios and a critical network metric: the initial diameter, under specific conditions related to the initial distribution of opinions. |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2405.01341&r= |
| By: | Antonio Scala; Marco Delmastro |
| Abstract: | Networks have always played a special role for human beings in shaping social relations, forming public opinion, and driving economic equilibria. Nowadays, online networked platforms dominate digital markets and capitalization leader-boards, while social networks drive public discussion. Despite the importance of networks in many economic and social domains (economics, sociology, anthropology, psychology, ...), the knowledge about the laws that dominate their dynamics is still scarce and fragmented. Here, we analyse a wide set of online networks (those financed by advertising) by investigating their value dynamics from several perspectives: the type of service, the geographic scope, the merging between networks, and the relationship between economic and financial value. The results show that the networks are dominated by strongly nonlinear dynamics. The existence of non-linearity is often underestimated in social sciences because it involves contexts that are difficult to deal with, such as the presence of multiple equilibria -- some of which are unstable. Yet, these dynamics must be fully understood and addressed if we aim to understand the recent evolution in the economic, political and social milieus, which are precisely characterised by corner equilibria (e.g., polarization, winner-take-all solutions, increasing inequality) and nonlinear patterns. |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2208.04813&r= |
| By: | Costa-Font, Joan; Ljunge, Martin |
| Abstract: | Ideological spillovers refer to the modification of an individual's core beliefs after learning about other people's beliefs. We study one specific international ideological spillover, namely, the effect of the unexpected election of a United States (US) president (Donald Trump on the 9 th of November 2016), who openly questioned the so-called ‘core liberal consensus’, on European's core political beliefs. Using a regression discontinuity design (RDD) around the election event, we show that the Trump presidential election (TPE) gave rise to a ‘backlash effect’. That is, it steered core European beliefs in two specific domains, making Europeans more favourable to (i) globalisation and (ii) international mobility (about 10% change in the overall Likert scale range of the statement that immigrants contribute to a country). Contrasting with the hypotheses of ‘belief contagion’, we do not find evidence that TPE steered illiberal beliefs. Furthermore, TPE improved (deteriorated) the view Europeans had of their own country (the United States). |
| Keywords: | political shocks; belief formation; information spillovers; backlash effect; pluralistic ignorance; Trump presidential election; political beliefs; the social formation of beliefs |
| JEL: | D72 F50 Z10 P16 |
| Date: | 2023–02–28 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:114902&r= |
| By: | Hsieh, Chih Sheng; Deer, Lachlan (Tilburg University, School of Economics and Management); Koenig, Michael; Vega-Redondo, Fernando |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:tiu:tiutis:d03852a7-c5e7-4be0-8583-1cee0d69bea7&r= |
| By: | Dyer, Travis; Köchling, Gerrit; Limbach, Peter |
| Abstract: | We show that investors acquire more public information about firms to which they are more socially proximate. On average, a standard deviation increase in the Social Connectedness Index (Bailey et al., 2018) between a firm's headquarter county and a searcher county is associated with 30% more EDGAR filing downloads from the searcher county. The effect of social proximity on traditional investment research is distinct from the effect of geographic proximity. We find similar results studying headquarter relocations, investor-level data, and EDGAR downloads from European regions, for which physical distance should be irrelevant. Social proximity matters more during times of high market-wide uncertainty and for firms with weaker information environments. Finally, information gathered by socially proximate investors predicts short-term earnings and stock returns, but also heightened volatility. Collectively, the evidence indicates that social networks mitigate informational frictions and foster information acquisition in financial markets. |
| Keywords: | Corporate disclosures, EDGAR, Geography, Information acquisition, Social networks, Social connections |
| JEL: | D80 D83 G10 G41 M40 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cfrwps:294838&r= |