In this issue we feature 12 current papers on the theme of social capital, chosen by Fabio Sabatini (Università degli Studi di Roma “La Sapienza”):

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1. Incarcerate one to calm the others? Spillover effects of incarceration among criminal groups - Philippe, Arnaud
2. The Strength of Absent Ties: Social Integration via Online Dating - Josue Ortega; Philipp Hergovich
3. Institutional shocks and economic outcomes : Allende's election, Pinochet's coup and the Santiago stock market - Daniele Girardi; Samuel Bowles
4. The limits to moral erosion in markets: social norms and the replacement excuse - Björn Bartling; Yagiz Özdemir
5. Word of Mouth Communication and Search - Campbell, Arthur; Leister, Matthew; Zenou, Yves
6. Entitlements and Loyalty in Groups: An Experimental Study - Paetzel, Fabian; Sausgruber, Rupert
7. Bonds and bridges, and between: An empirical analysis of group-based trust - Stephany, Fabian; Braesemann, Fabian
8. Distributions of Centrality on Networks - Krishna Dasaratha
9. Estimation of Peer Effects in Endogenous Social Networks: Control Function Approach - Ida Johnsson; Hyungsik Roger Moon
10. Social Capital and Mental Health in Indonesia - Mohamad Fahmi; Adiatma Siregar; Deni K Sunjaya; Gilang Amarullah; Rahma - Rahma; Nur Afni Panjaitan
11. Culture, Diffusion, and Economic Development: The Problem of Observational Equivalence - Ani Harutyunyan; Ömer Özak
12. "Relation between Civic Attitudes, Generalized and Institutional Trust in Six Regions of the Russian Federation" - Svetlana Maximova

 1. Incarcerate one to calm the others? Spillover effects of incarceration among criminal groups

    Philippe, Arnaud

 This paper documents the effect of peers’ incarceration on an individual’s  criminal activity within small criminal groups. Using established criminal  groups, I built a 48-month panel that records the criminal status, Individual  imprisonment status and imprisonment status of group members. Panel  regressions with individual fixed effects allows me to document five facts.

 First, the incarceration of a peer is associated with a 5 per cent decrease  in the arrest rate among groups composed of two persons. No effect is  observed among bigger groups. Second, this effect is present even for  incarceration following lone crimes, ruling out an explanation based on  common shocks. Third, the probability of committing a group crime strongly  decreases, and there is no shift to crime with other peers or lone crimes.

 Four, this general effect hides significant within-group heterogeneity. The  results are consistent with the idea that ‘leaders’ are not affected by the  incarceration of ‘followers’. Five, the effect seems to be driven by lower  risky behaviour among offenders who remain free, and not by ‘criminal  capital’ loss or deterrence.

URL: http://d.repec.org/n?u=RePEc:tse:iastwp:32041&r=soc

 2. The Strength of Absent Ties: Social Integration via Online Dating

    Josue Ortega

    Philipp Hergovich

 We used to marry people to which we were somehow connected to: friends of  friends, schoolmates, neighbours. Since we were more connected to people  similar to us, we were likely to marry someone from our own race. However,  online dating has changed this pattern: people who meet online tend to be  complete strangers. Given that one-third of modern marriages start online, we  investigate theoretically, using random graphs and matching theory, the  effects of those previously absent ties in the diversity of modern societies.

 We find that when a society benefits from previously absent ties, social  integration occurs rapidly, even if the number of partners met online is  small. Our findings are consistent with the sharp increase in interracial  marriages in the U.S. in the last two decades.

URL: http://d.repec.org/n?u=RePEc:arx:papers:1709.10478&r=soc

 3. Institutional shocks and economic outcomes : Allende's election, Pinochet's coup and the Santiago stock market

    Daniele Girardi (University of Massachusetts Amherst)

    Samuel Bowles (Santa Fe Institute)

 To study the effect of political and institutional changes on the economy, we  look at share prices in the Santiago exchange during the tumultuous political  events that characterized Chile in the early 1970s. We use a transparent  empirical strategy, deploying previously unused daily data and exploiting two  largely unexpected shocks which involved substantial variation in policies  and institutions, providing a rare natural experiment. Allende's election and  subsequent socialist experiment decreased share values, while the military  coup and dictatorship that replaced him boosted them, in both cases by  magnitudes unprecedented in the literature.

    Keywords: institutional shocks, natural experiment, share prices, Chile, socialism, military coup, elections

    JEL: P00 P16 D02 E02 N2

URL: http://d.repec.org/n?u=RePEc:ums:papers:2017-19&r=soc

 4. The limits to moral erosion in markets: social norms and the replacement excuse

    Björn Bartling

    Yagiz Özdemir

 This paper studies the impact of a key feature of competitive markets on  moral behavior: the possibility that a competitor will step in and conclude  the deal if a conscientious market actor forgoes a profitable business  opportunity for ethical reasons. We study experimentally whether people  employ the argument "if I don’t do it, someone else will" to justify taking a  narrowly self-interested action. Our data reveal a clear pattern. Subjects do  not employ the "replacement excuse" if a social norm exists that classifies  the selfish action as immoral. But if no social norm exists, subjects are  more inclined to take a selfish action in situations where another subject  can otherwise take it. By demonstrating the importance of social norms of  moral behavior for limiting the power of the replacement excuse, our paper  informs the long-standing debate on the effect of markets on morals.

    Keywords: Replacement excuse, social norms, moral behavior, competition, markets, utilitarianism, deontological ethics

    JEL: C92 D02 D63

URL: http://d.repec.org/n?u=RePEc:zur:econwp:263&r=soc

 5. Word of Mouth Communication and Search

    Campbell, Arthur

    Leister, Matthew

    Zenou, Yves

 In many economic contexts, the most credible source of information about the  quality of products is one's friends. In this paper, we develop a  word-of-mouth model of search for an experience good where the quality is  unknown. We find the characteristics of the social net-work that result in  exclusively low quality, a mixture of qualities and exclusively high-quality  products. When consumer search is costly, an exclusively high-quality  equilibrium is not possible. Moreover, markets may become stuck in a  low-quality equilibrium when equilibria with better quality are possible.

 Market inefficiencies are characterized by an under-investment in friends and  a market's misallocation of low-quality firms.

    Keywords: giant component; inefficiencies; search; Social Networks

    JEL: D83 D85 L15

URL: http://d.repec.org/n?u=RePEc:cpr:ceprdp:12326&r=soc

 6. Entitlements and Loyalty in Groups: An Experimental Study

    Paetzel, Fabian

    Sausgruber, Rupert

 We study loyalty in groups that are exogenously assigned based on members' performances in a task. We observe that in-group bias is strong and  significant among subjects who score high in performance, and that it is weak  and insignificant among those who score low. This asymmetric pattern is  mirrored in the punishment of disloyal subjects within groups. The results  are consistent with an explanation according to which fairness judgments  depend on entitlement considerations and provide a new perspective on theory  and empirical research that argues that group identity increases with the  status of the group.

    Keywords: entitlements,fairness,group loyalty,status,punishment,social norms,minimal groups

    JEL: C92 D31 D63

URL: http://d.repec.org/n?u=RePEc:zbw:vfsc17:168224&r=soc

 7. Bonds and bridges, and between: An empirical analysis of group-based trust

    Stephany, Fabian

    Braesemann, Fabian

 Social capital is often represented by generalized trust - the degree to  which one trusts "most (unknown) people". It is assumed to be enhanced by  diverse group interactions. In the social capital literature, it is opposed  by particularized trust, which represents our mutual confidence in  individuals close to us, for example, family members and friends. This study,  based on a survey with 634 university students from Austria, questions the  existing dichotomy between the two trust types. Our results advocate in  favour of a third, community determined type of trust. This additional trust  dimension is measured by the number of groups the individuals participate in.

 It changes between particularized and generalized trust, depending on  measures of group context, like frequency of interaction or group size. Thus,  the results support hypotheses made in the recent literature about the  multidimensionality of trust and quantify the effect of group participation  on trust.

    Keywords: Generalized Trust,Networks,Social Capital,Panel Data,Instrumental Variables

    JEL: C36 C93 D70 Z13

URL: http://d.repec.org/n?u=RePEc:zbw:agawps:09&r=soc

 8. Distributions of Centrality on Networks

    Krishna Dasaratha

 In many social and economic networks, agents' outcomes depend substantially  on the centrality of their network position. Our current understanding of  network centrality is largely restricted to deterministic settings, but in  many applications data limitations or theoretical concerns lead practitioners  to use random network models. We provide a foundation for understanding how  central agents in random networks are likely to be. Our main theorems show  that on large random networks, centrality measures are close to their  expected values with high probability. By applying these theorems to  stochastic block models, we study how segregated networks contribute to  inequality. When networks are segregated, benefits from peer effects tend to  accrue unevenly to the advantage of more central individuals and groups. We  also discuss applications to more general network formation models, including  models where link probabilities are governed by geography.

URL: http://d.repec.org/n?u=RePEc:arx:papers:1709.10402&r=soc

 9. Estimation of Peer Effects in Endogenous Social Networks: Control Function Approach

    Ida Johnsson

    Hyungsik Roger Moon

 We propose a method of estimating the linear-in-means model of peer effects  in which the peer group, defined by a social network, is endogenous in the  outcome equation for peer effects. Endogeneity is due to unobservable  individual characteristics that influence both link formation in the network  and the outcome of interest. We propose two estimators of the peer effect  equation that control for the endogeneity of the social connections using a  control function approach. We leave the functional form of the control  function unspecified and treat it as unknown. To estimate the model, we use a  sieve semiparametric approach, and we establish asymptotics of the  semiparametric estimator.

URL: http://d.repec.org/n?u=RePEc:arx:papers:1709.10024&r=soc

10. Social Capital and Mental Health in Indonesia

    Mohamad Fahmi (Department of Economics, Padjadjaran University)

    Adiatma Siregar (Department of Economics, Padjadjaran University)

    Deni K Sunjaya (Department of Public Health, Padjadjaran University)

    Gilang Amarullah (Department of Economics, Padjadjaran University)

    Rahma Rahma (Department of Economics, Padjadjaran University)

    Nur Afni Panjaitan (Department of Economics, Padjadjaran University)  Mental health is the integral part of overall health. Despite the importance  of mental health, most health policy are directed for physical, while mental  issues left behind.The similar pattern is also happen in Indonesia. This  paper aim to examine the impact of social capital to individual mental  health. We utilize IFLS 2014 database since it provide comprehensive  information on mental health as well as social capital. Mental health is  represented by self-reported of depression CESD-R-10 scale. Social capital  represented by social trust in individual and community level as well as  participation in community. The research using mixed level regression model  method with number of observation 28,257 respondents. We also incorporated  control variable such as age, gender, marital status, working status,  household size, income, and education. Result of the study showed that social  trust and participation in community has no significant contribution to  depression. On the other hand, control variables such as being older, male,  and married associated with lower probability of depression.

    Keywords: social capital, mental health, Indonesia

    JEL: I0

URL: http://d.repec.org/n?u=RePEc:unp:wpaper:201701&r=soc

11. Culture, Diffusion, and Economic Development: The Problem of Observational Equivalence

    Ani Harutyunyan (LICOS - Centre for Institutions and Economic Performance at KU Leuven)

    Ömer Özak (Southern Methodist University)  This research explores the direct and barrier effects of culture on economic  development. It shows both theoretically and empirically that whenever the  technological frontier is at the top or bottom of the world distribution of a  cultural value, there exists an observational equivalence between absolute  cultural distances and cultural distances relative to the frontier,  preventing the identification of its direct and barrier effects. Since the  technological frontier usually has the ``right'' cultural values for  development, it tends to be in the extremes of the distribution of cultural  traits, generating observational equivalence and confounding the analysis.

 These results highlight the difficulty of disentangling the direct and  barrier effects of culture. The empirical analysis finds suggestive evidence  for direct effects of individualism and conformity with hierarchy, and  barrier effects of hedonism.

    Keywords: Comparative economic development, cultural differences, barriers to technological diffusion, individualism, power distance, vertical hierarchy, hedonism, linguistic distance

    JEL: O10 O11 O20 O33 O40 O47 O57 Z10

URL: http://d.repec.org/n?u=RePEc:smu:ecowpa:1702&r=soc

12. "Relation between Civic Attitudes, Generalized and Institutional Trust in Six Regions of the Russian Federation"

    Svetlana Maximova (Altai State University, Russian Federation

     Author-2-Name: Maxim Maximov Author-2-Workplace-Name: Altai State

     University, Russian Federation Author-3-Name: Oksana Noyanzina

     Author-3-Workplace-Name: Altai State University, Russian Federation

     Author-4-Name: Daria Omelchenko Author-4-Workplace-Name: Altai State

     University, Russian Federation Author-5-Name: "Natalia Goncharova"

     Author-5-Workplace-Name: Altai State University, Russian Federation

     Author-6-Name: Anastasiia Morkovkina Author-6-Workplace-Name: "Lomonosov

     Moscow State University, Russian Federation ")  "Objective – The article presents an analysis of the relationship between  generalized and institutional trust indicators and manifestation of civic  representations, attitudes and behaviour in six Russian regions: Altai,  Jewish Autonomous region, Trans-Baikal, Kemerovo, Omsk and Orenburg regions.

 Methodology/Technique – The data collected in 2015 from multistage stratified  sample 2400 respondents and their age from 18 to 70 years. Findings – Among  the studied regions, the highest levels of both interpersonal trust and  confidence in social institutions were founded in the Jewish Autonomous  Region, the lowest trust levels for many government entities and non-profit  organizations are in the Trans-Baikal Territory, the Kemerovo Region and the  Omsk region. The levels of civic participation are higher in regions with  higher levels of trust. Novelty – The study suggests that trust, both  interpersonal and institutional, are a factor in the development of civil  society."

    Keywords: "Trust; Generalized Trust, Institutional Trust; Civic Attitudes; Civic Engagement; Civic Responsibility; NonProfit Organizations; Regions of Russian Federation. "

    JEL: Z13 Z18

URL: http://d.repec.org/n?u=RePEc:gtr:gatrjs:jmmr124&r=soc

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