In this issue we feature 10 current papers on the theme of social capital:

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1. In this issue we have:
2. Morality: evolutionary foundations and policy implications - Alger, Ingela; Weibull, Jörgen
3. Incentives and Ethics in the Economics of Body Parts - Nicola Lacetera
4. How Do Rights Revolutions Occur? Free Speech and the First Amendment - Chen, Daniel L.; Yeh, Susan
5. A Theory of Community Formation and Social Hierarchy - Athey, Susan; Calvano, Emilio; Jha, Saumitra
6. Gender differences and social ties effects in resource sharing - d'Exelle, Ben; Riedl, Arno
7. Social Identity and Group Contests - Zaunbrecher, Henrik; Riedl, Arno
8. Urban Networks: Connecting Markets, People, and Ideas - Glaeser, Edward L.; Ponzetto, Giacomo A. M.; Zou, Yimei
9. Groups and trust: Distributive Justice with Production and the Social Contract. An Experimental study - Giacomo Degli Antoni; Marco Faillo; Lorenzo Sacconi; Pedro Francés-Gomez
10. Trust under the Prospect Theory and Quasi-Hyperbolic Preferences: A Field Experiment in Vietnam - Quang Nguyen; Marie Claire Villeval; Hui Xu
11. Why Family Matters: The Impact of Family Resources on Immigrant Entrepreneurs’ Exit from Entrepreneurship - Bird, Miriam; Wennberg, Karl

 1. Morality: evolutionary foundations and policy implications

    Alger, Ingela

    Weibull, Jörgen

 Since the publication of Adam Smithís Wealth of Nations, it has been  customary among economists to presume that economic agents are purely  selfinterested. However, research in experimental and behavioral economics  has shown that human motivation is more complex and that observed behavior is  often better explained by additional motivational factors such as a concern  for fairness, social welfare etc. As a complement to that body of work we  have carried out theoretical investigations into the evolutionary foundations  of human motivation (Alger and Weibull 2013, 2016). We found that natural  selection, in starkly simpliÖed but mathematically well-structured  environments, favors preferences that combine self-interest with morality.

 Roughly speaking, the moral component evaluates oneís own action in terms of  what would happen, if, hypothetically, this action were adopted by others.

 Such moral preferences have important implications for economic behavior.

 They motivate individuals to contribute to public goods, to give fair o§ers  when they could get away with cheap o§ers, and to contribute to social  institutions and act in environmentally friendly ways even if their  individual impact is negligible.

URL: http://d.repec.org/n?u=RePEc:tse:iastwp:31010&r=soc

 2. Incentives and Ethics in the Economics of Body Parts

    Nicola Lacetera

 Research shows that properly devised economic incentives increase the supply  of blood without hampering its safety; similar effects may be expected also  for other body parts such as bone marrow and organs. These positive effects  alone, however, do not necessarily justify the introduction of payments for  supplying body parts; these activities concern contested commodities or  repugnant transactions, i.e. societies may want to prevent certain ways to  regulate a transaction even if they increased supply, because of ethical  concerns. When transactions concern contested commodities, therefore,  societies often face trade-offs between the efficiency-enhancing effects of  trades mediated by a monetary price, and the moral opposition to the  provision of these payments. In this essay, I first describe and discuss the  current debate on the role of moral repugnance in controversial markets, with  a focus on markets for organs, tissues, blood and plasma. I then report on  recent studies focused on understanding the trade-offs that individuals face  when forming their opinions about how a society should organize certain  transactions.

    JEL: D47 D63 D64 I11 K32 Z13

URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:22673&r=soc

 3. How Do Rights Revolutions Occur? Free Speech and the First Amendment

    Chen, Daniel L.

    Yeh, Susan

 Does law shape values? We test a model of law and norms using an area of law  where economic incentives are arguably not the prime drivers of social  change. From 1958–2008, Democratic judges were more likely than Republicans  to favor progressive free speech standards. Using the random assignment of  U.S. federal court judges setting geographically-local precedent, we estimate  that progressive free speech standards liberalized sexual attitudes and  behaviors and increased both crime rates and the spread of sexually  transmitted diseases. We then randomly allocated data entry workers to enter  newsarticles of court decisions. Progressive decisions liberalized sexual  attitudes and shifted norm perceptions for data entry subjects, but not  self-reported behavior. These results present evidence of law’s expressive  power – with fundamental implications for decision making in social and  political settings and for the empirical predictions of theoretical models in  these domains.

    Keywords: Law and norms, expressive law, cultural change

    JEL: J12 J16 K42 N32 N42 Z1

URL: http://d.repec.org/n?u=RePEc:tse:iastwp:31022&r=soc

 4. A Theory of Community Formation and Social Hierarchy

    Athey, Susan (Stanford University)

    Calvano, Emilio (Bologna University)

    Jha, Saumitra (Stanford University)

 We analyze the classic problem of sustaining trust when cheating and leaving  trading partners is easy, and outside enforcement is difficult. We construct  equilibria where individuals are loyal to smaller groups--communities--that  allow repeated interaction. Hierarchies provide incentives for loyalty and  allow individuals to trust agents to extent that the agents are actually  trustworthy. We contrast these with other plausible institutions for  engendering loyalty that require inefficient withholding of trust to support  group norms, and are not robust to coalitional deviations. In communities  whose members randomly match, we show that social mobility within hierarchies  falls as temptations to cheat rise. In communities where individuals can  concentrate their trading with pre-selected members, hierarchies where senior  members are favored for trade sustain trust even in the presence of proximate  nonhierarchical communities. We link these results to the emergence of trust  in new market environments and early human societies.

URL: http://d.repec.org/n?u=RePEc:ecl:stabus:3467&r=soc

 5. Gender differences and social ties effects in resource sharing

    d'Exelle, Ben (university of east anglia)

    Riedl, Arno (General Economics 1 (Micro))  In rural areas in developing countries gender inequality tends to be severe  which might have substantial welfare implications if it determines how scarce  economic resources are shared between men and women. Therefore, it is  important to know how gender influences resource sharing and - given the  strong embeddedness of resource sharing in social networks - in what ways  social ties interact with this influence. To investigate this, we combine  data from resource allocation experiments and a social network survey in  rural Nicaragua. We find that women share less than men, and that this  difference is largest among people of the same village and of different  gender. We also find that social ties exert an important influence on sharing  and that women have fewer friendship ties within their village than men.

 Regression analysis shows important gender differences in the effect of  social ties on sharing. While both men and women share more with female  friends than with female non-friends, women share less with male friends than  with male non-friends. We also find that with controls for friendship ties,  there remains a direct gender effect on within-village sharing, with men  sharing more than women. Finally, we find that our results are robust to  potential gender differences in the reporting of social ties.

    Keywords: resource sharing, social ties, gender, lab-in-the-field experiment, Nicaragua

    JEL: C90 Z10

URL: http://d.repec.org/n?u=RePEc:unm:umagsb:2016023&r=soc

 6. Social Identity and Group Contests

    Zaunbrecher, Henrik (General Economics 1 (Micro))

    Riedl, Arno (General Economics 1 (Micro))  Social identity has been shown to successfully enhance cooperation and effort  in cooperation and coordination games. Little is known about the causal  effect of social identity on the propensity to engage in group conflict. In  this paper we explore theoretically and experimentally whether social  identity increases investments in group contests. We show theoretically that  increased social identity with the own group implies higher investments in  Tullock contests. Empirically we find that induced social identity does  increase group closeness but does not increase conflict investments.

    Keywords: social identity, group, contest, experiment

    JEL: C92 D03 D71 D74

URL: http://d.repec.org/n?u=RePEc:unm:umagsb:2016024&r=soc

 7. Urban Networks: Connecting Markets, People, and Ideas

    Glaeser, Edward L. (Harvard University)

    Ponzetto, Giacomo A. M. (Universitat Pompeu Fabra and Barcelona GSE)

    Zou, Yimei (Universitat Pompeu Fabra)  Should China build mega-cities or a network of linked middle-sized  metropolises? Can Europe's mid-sized cities compete with global agglomeration  by forging stronger inter-urban links? This paper examines these questions  within a model of recombinant growth and endogenous local amenities. Three  primary factors determine the trade-off between networks and big cities:

 local returns to scale in innovation, the elasticity of housing supply, and  the importance of local amenities. Even if there are global increasing  returns, the returns to local scale in innovation may be decreasing, and that  makes networks more appealing than mega-cities. Inelastic housing supply  makes it harder to supply more space in dense confines, which perhaps  explains why networks are more popular in regulated Europe than in the  American Sunbelt. Larger cities can dominate networks because of amenities,  as long as the benefits of scale overwhelm the downsides of density. In our  framework, the skilled are more likely to prefer mega-cities than the less  skilled, and the long-run benefits of either mega-cities or networks may be  quite different from the short-run benefits.

URL: http://d.repec.org/n?u=RePEc:ecl:harjfk:15-078&r=soc

 8. Groups and trust: Distributive Justice with Production and the Social Contract. An Experimental study

    Giacomo Degli Antoni (University of Parma, Department of Law)

    Marco Faillo (University of Trento)

    Lorenzo Sacconi (University of Trento)

    Pedro Francés-Gomez (University of Granada)  Drawing on the theoretical and experimental literature on distributive  justice, we put some assumptions of the contractarian argument to an  empirical test by means of an experiment which investigates the influence  that explicit agreement under the veil of ignorance may have on individuals' conception of justice and its implementation in a context of the production  and distribution of a common output. One crucial characteristic of our  experiment is that subjects are assigned unequal endowments for which they  are not responsible; the assignment is random. At the same time, their work  naturally generates unequal levels of earnings. Do the subjects involved in  this interaction distinguish between the two types of inequality? Do they try  to reduce the arbitrary one, while accepting the one generated through  effort? Do they elaborate other distributive criteria? Does their choice  ex-ante, when they are behind the veil, differ from their choice ex-post once  the veil has been lifted and they know the outcome of the production phase?

 The main result is that the agreement under a veil of ignorance induces  subjects to accept a liberal egalitarian division rule not only in the  ex-ante agreement, but also in the actual implementation of the pie division,  even if this contradicts their self-interest and some common economic  assumptions about reciprocal expectations of rationality. In addition, our  results show that deliberating through open discussion increases the level of  ex-post compliance.

    Keywords: Trust; Distributive justice, social contract, fairness, dictator game, contractarian business ethics

    JEL: C72 C91 D02 D63

URL: http://d.repec.org/n?u=RePEc:ent:wpaper:wp60&r=soc

 9. Trust under the Prospect Theory and Quasi-Hyperbolic Preferences: A Field Experiment in Vietnam

    Quang Nguyen (Middlesex University [London] - Middlesex University)

    Marie Claire Villeval (GATE Lyon Saint-Étienne - Groupe d'analyse et de

     théorie économique - ENS Lyon - École normale supérieure - Lyon - UL2 -

     Université Lumière - Lyon 2 - UCBL - Université Claude Bernard Lyon 1 -

     Université Jean Monnet - Saint-Etienne - PRES Université de Lyon - CNRS -

     Centre National de la Recherche Scientifique)

    Hui Xu (Beijing Normal University, GATE Lyon Saint-Étienne - Groupe

     d'analyse et de théorie économique - ENS Lyon - École normale supérieure -

     Lyon - UL2 - Université Lumière - Lyon 2 - UCBL - Université Claude

     Bernard Lyon 1 - Université Jean Monnet - Saint-Etienne - PRES Université de Lyon - CNRS - Centre National de la Recherche Scientifique)  Virtually every commercial transaction has within itself an element of trust,  certainly any transaction conducted over a period of time. It can be  plausibly argued that much of the economic backwardness in the world can be  explained by the lack of mutual confidence. (Arrow 1972)

    Keywords: risk preferences, time preferences, Cumulative Prospect Theory, Vietnam, field experiment, trustworthiness,trust

URL: http://d.repec.org/n?u=RePEc:hal:journl:halshs-01300735&r=soc

10. Why Family Matters: The Impact of Family Resources on Immigrant Entrepreneurs’ Exit from Entrepreneurship

    Bird, Miriam (Center for Family Business, University of St. Gallen)

    Wennberg, Karl (Stockholm School of Economics, Institute of Analytical

     Sociology (IAS) and the Ratio Institute)  We integrate insights from the social embeddedness perspective with research  on immigrant entrepreneurship to theorize on how family resources influence  exit from entrepreneurship among previously unemployed immigrant  entrepreneurs. Results from a cohort study of immigrant entrepreneurs in  Sweden reveal that family resources are important for immigrants to integrate  economically into a country. We find that having family members in  geographical proximity increases immigrant entrepreneurs’ likelihood of  remaining in entrepreneurship. Further, family financial capital enhances  immigrant entrepreneurs’ likelihood of remaining in entrepreneurship as well  as their likelihood of exiting to paid employment. Although often neglected  in immigrant entrepreneurship studies, resources accruing from spousal  relationships with natives influence entrepreneurs’ exit behavior. We discuss  contributions for research on entrepreneurial exit, entrepreneurs’ social  embeddedness, and immigrant entrepreneurship.

    Keywords: Immigrant entrepreneurship; entrepreneurial exit; family resources; social embeddedness; relational embeddedness

    JEL: J60 L26

URL: http://d.repec.org/n?u=RePEc:hhs:ratioi:0274&r=soc

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