Date:

2014-10

By:

James Andreoni
Alison Sanchez

URL:

http://d.repec.org/n?u=RePEc:nbr:nberwo:20649&r=soc

We study whether actions are justified by beliefs, as is usually assumed, or whether beliefs are justified by actions. In our experiment, subjects participate in a trust game, after which they have an opportunity to state their beliefs about their opponent's actions. Subsequently, subjects participate in a task designed to "reveal" their true beliefs. We find that subjects who make selfish choices and show strategic sophistication falsely state their beliefs in order to project a more favorable social image. By contrast, their "revealed" beliefs were significantly more accurate, which betrayed these subjects as knowing that their selfishness was not justifiable by their opponent's behavior.

JEL:

C9 D03 D83

Date:

2014-05

By:

Michal Bauer (Institute of Economic Studies, Faculty of Social Sciences, Charles University in Prague, Smetanovo nábreží 6, 111 01 Prague 1, Czech Republic)
Nathan Fiala (University of Connecticut)
Ian Levely (Institute of Economic Studies, Faculty of Social Sciences, Charles University in Prague, Smetanovo nábreží 6, 111 01 Prague 1, Czech Republic)

URL:

http://d.repec.org/n?u=RePEc:fau:wpaper:wp2014_20&r=soc

We use a set of experiments to study the effects of forced military service for a rebel group on social capital. We examine the case of Northern Uganda, where recruits did not self-select nor were systematically screened by rebels. We find that individual cooperativeness robustly increases with length of soldiering, especially among those who soldiered during early age. Parents of ex-soldiers are aware of the behavioral difference: they trust ex-soldiers more and expect them to be more trustworthy. These results suggest that the impact of child soldiering on social capital, in contrast to human capital, is not necessarily detrimental.

JEL:

C93 D03 D74 O12

Date:

2014

By:

Vincent Boucher

URL:

http://d.repec.org/n?u=RePEc:lvl:lacicr:1424&r=soc

I present a model of conformism in social networks that incorporates both peer effects and self-selection. I find that equilibrium behaviors are linked through the Laplacian matrix of the equilibrium network. I show that conformism has positive social value and that social welfare can be bounded by network centrality and connectivity measures. I apply the model using empirical data on high school student participation in extracurricular activities. I find that the local effects of conformism (i.e. endogenous peer effect for a fixed network structure) range from 7.5% to 45%, depending on the number of peers that an individual has. Simulations show that the optimal policies of an inequality-averse policy-maker change in relation to the size of a school. Small schools should encourage shy students to integrate more with other students, while large schools should focus on promoting role models within the school.

Keywords:

Conformism, peer effects, network formation

JEL:

D85 C31

Date:

2014-10

By:

Lars Kunze
Nicolai Suppa

URL:

http://d.repec.org/n?u=RePEc:rwi:repape:0510&r=soc

This article examines the impact of unemployment on social participation for Germany using the German Socio-Economic Panel. We find significant negative, robust and, for some activities, lasting effects of unemployment on social participation. Causality is established by focussing on plant closures as exogenous entries into unemployment. Social norms, labor market prospects and the perception of individual failure are shown to be relevant for explaining these findings. Furthermore, our results not only (i) provide novel insights into the determinants of the unemployed’s unhappiness but also (ii) highlight an hitherto unexplored channel through which unemployment influences economic outcomes, namely by altering the long-run level of social capital, and (iii) point to an alternative explanation of unemployment hysteresis based on access to information.

Keywords:

Income redistribution; consumer credit; relative consumption motive; business cycles

JEL:

E21 E32 E44

Date:

2014-08

By:

Abhijit Banerjee
Arun G. Chandrasekhar
Esther Duflo
Matthew O. Jackson

URL:

http://d.repec.org/n?u=RePEc:nbr:nberwo:20422&r=soc

Can we identify the members of a community who are best- placed to diffuse information simply by asking a random sample of individuals? We show that boundedly-rational individuals can, simply by tracking sources of gossip, identify those who are most central in a network according to "diffusion centrality," which nests other standard centrality measures. Testing this prediction with data from 35 Indian villages, we find that respondents accurately nominate those who are diffusion central (not just those with many friends). Moreover, these nominees are more central in the network than traditional village leaders and geographically central individuals.

JEL:

D13 D85 L14 O12 Z13

Date:

2014-11

By:

Facundo Albornoz
Antonio Cabrales
Esther Hauk

URL:

http://d.repec.org/n?u=RePEc:bge:wpaper:797&r=soc

We study a model that integrates productive and socialization efforts with network choice and parental investments. We characterize the unique symmetric equilibrium of this game. We first show that individuals underinvest in productive and social effort, but that solving only the investment problem can exacerbate the misallocations due to network choice, to the point that it may generate an even lower social welfare if one of the networks is sufficiently disadvantaged. We also study the interaction of parental investment with network choice. We relate these equilibrium results with characteristics that we find in the data on economic co-authorship and field transmission between advisors and advisees.

Keywords:

peer effects, network formation, cultural identity, parental involvement, immigrant sorting

JEL:

I20 I28 J15 J24 J61

Date:

2014-10-29

By:

Markus Leibrecht
Hans Pitlik (WIFO)

URL:

http://d.repec.org/n?u=RePEc:wfo:wpaper:y:2014:i:481&r=soc

It is frequently claimed that high levels of generalised trust are conducive for economic reforms. In contrast, the "traditional view" on institutional and political constraints on the executive (IPCE) postulates that high IPCE tend to paralyse the decision-making process, thus blocking required policy changes. By stressing credibility issues of economic reforms and transaction cost for special interest groups, a more positive view however sees IPCE as potentially conducive to reforms. This paper empirically explores the significance of these claims for the case of economic deregulation. In particular, it elaborates on the hypotheses that IPCE do not impact on economic reforms in an environment of high generalised trust and that the positive impact of trust increases with the extent of IPCE. The results provide evidence in favour of the traditional view on IPCE. However, it is also shown that IPCE are an obstacle for economic policy liberalisation only in relatively low trusting environments. In contrast, a robust positive correlation of generalised trust with the extent of economic deregulation is isolated, and trust unfolds a particular strength with increasing levels of IPCE.

Date:

2014-08

By:

Luttmer, Erzo F.P. (Dartmouth College)
Singhal, Monica (Harvard Kennedy School)

URL:

http://d.repec.org/n?u=RePEc:iza:izadps:dp8448&r=soc

Standard economic models of tax compliance have focused on enforcement-driven compliance. Notably, tax administrators also tend to place a great deal of emphasis on the importance of improving "tax morale" by encouraging voluntary compliance, creating a culture of compliance, and changing social norms. Tax morale does indeed appear to be an important component of compliance decisions, and there is strong evidence that tax morale operates through a variety of underlying channels. There is less evidence - to date - that indicates we know how to leverage these channels to improve compliance and revenue collection in a consistently successful way.

Keywords:

tax compliance, intrinsic motivation, reciprocity, social effects, culture

JEL:

H26

Date:

2014

By:

Campbell, Danny
Erdem, Seda

URL:

http://d.repec.org/n?u=RePEc:ags:aaea14:177167&r=soc

This paper investigates the effect of physical position on ‘best’ and ‘worst’ choices in the bestworst scaling technique. Although the best-worst scaling technique has been used widely in many fields, the phenomenon of consumers’ adoption of processing strategies while making choices has been largely overlooked. We examine this issue in the context of consumers’ perception of trust in institutions to provide information about a new food technology, namely nanotechnology, and its use in food processing. Our results show that around half of the consumers used position as a schematic cue when making choices. We find the position bias is particularly strong when consumers chose their most trustworthy institution compared to their least trustworthy institution. In light of our findings, we recommend researchers in the field to be aware of the possibility of position bias when designing best-worst scaling surveys. We also encourage researchers who have already collected best-worst data to investigate whether their data shows such heuristics.

Keywords:

best-worst scaling, position bias, consumer trust, multinomial logit model, latent class logit model, Consumer/Household Economics, Research Methods/ Statistical Methods, C25, D12, Q18.

Date:

2014

By:

Asirvatham, Jebaraj
Thomsen, Michael
Nayga, Rodolfo M. Jr.
Rouse, Heather

URL:

http://d.repec.org/n?u=RePEc:ags:aaea14:170387&r=soc

This study investigates whether peers are a contributing factor in childhood body-weight outcomes. Using an instrumental variables method on exogenously assigned peers, we find that the weight of peers within the same grade and school significantly impacts body mass index (BMI) z-score of an individual student. A typical student’s BMI z-score increases when facing heavier peers. The size of the peer-effect, however, is very modest. For a percentage point increase in the proportion of obese students in the same grade, a typical student’s BMI z-score increases by only 0.00341 standard deviations.

Keywords:

peer-effects, childhood obesity, social networks, Consumer/Household Economics, Food Consumption/Nutrition/Food Safety, Health Economics and Policy, Institutional and Behavioral Economics, D10, I10, Z13,