In this issue we feature 11 current papers on the theme of social capital, chosen by Fabio Sabatini (Università degli Studi di Roma “La Sapienza”):

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1. The Italian North-South Divide in Perceived Dishonesty: A Matter of Trust? Giuseppe Attanasi; Alessandro Bucciol; Simona Cicognani; Natalia Montinari
2. Migration, political institutions, and social networks - Catia Batista; Julia Seither; Pedro C. Vicente
3. Migration Networks and Location Decisions: Evidence from U.S. Mass Migration - Bryan Stuart; Evan Taylor
4. The co-evolution of tax evasion, social capital and policy responses: A theoretical approach - Luigi Bonatti; Lorenza Lorenzetti
5. Civic capital and support for the welfare state - Roy Cerqueti; Fabio Sabatini; Marco Ventura
6. Fairness and the unselfish demand for redistribution by taxpayers and welfare recipients - Fabio Sabatini; Marco Ventura; Eiji Yamamura; Luca Zamparelli
7. The effect of time preferences on altruism - Davide Dottori; Caterina Giannetti
8. Urban Interactions - Kim, Jun Sung; Patacchini, Eleonora; Picard, Pierre M.; Zenou, Yves
9. Watch your Words: an Experimental Study on Communication and the Opportunity Cost of Delegation - Armenak Antinyan; Luca Corazzini; Elena D\'Agosotino; Filippo Pavesi
10. Group meeting frequency and borrowers’ repayment performance in microfinance: Evidence from a quasi-natural experiment in South Africa - Lucia, Dalla Pellegrina; Angela, De Michele; Giorgio, Di Maio; Paolo, Landoni; Susanna, Parravicini;
11. Religiosity may not be a panacea: Importance of prosociality to maintain humanitarian donations - Shibly Shahrier; Koji Kotani; Makoto Kakinaka

 1. The Italian North-South Divide in Perceived Dishonesty: A Matter of Trust?

    Giuseppe Attanasi

    Alessandro Bucciol

    Simona Cicognani

    Natalia Montinari

 We present novel data on the perception of dishonesty in the public sector in  Italy, from a survey we carried out in August 2017. They concern a sample of  about 1,000 attendees at a mass-gathering music festival in Southern Italy,  whose audience includes a relevant fraction of subjects residing in North  Italy. The survey includes questions on perceived dishonesty at both an  institutional and social dimension. We measure whether regional differences  in the perception of dishonesty persist even when controlling for generalized  trust, the quality of institutions at the regional level, as well as  socio-demographic characteristics. We find that respondents from the North or  living abroad perceive lower level of dishonesty in the public sector  compared to respondents from the South. Once objective measures of corruption  and governance at the regional level are accounted for, the geographical gap  disappears, while generalized trust still matters. This evidence suggests  that individual and geographic differences in generalized trust must be taken  into account as they can affect the support for policy interventions aimed at  reducing dishonesty in the public sector.

    Keywords: Cultural event; Corruption; Dishonest behavior; Generalized Trust; Italy.

    JEL: A13 D73 K42 Z13

URL: http://d.repec.org/n?u=RePEc:ulp:sbbeta:2017-32&r=soc

 2. Migration, political institutions, and social networks

    Catia Batista

    Julia Seither

    Pedro C. Vicente

 What is the role of international migrants and, more specifically, of migrant  networks in shaping the quality of political institutions in migrant sending  countries? Our theory proposes that migration might change individual social  identities and in this way intrinsic motivation for political participation,  while it may also improve knowledge about better quality political  institutions. Hence, international migration might increase political  awareness and participation both by migrants and by other individuals in  their networks. To test this hypothesis, this paper uses several survey and  behavioral measures related to political participation and electoral  knowledge. These data were purposely collected around the time of the 2009  elections in Mozambique. The empirical results show that the number of  migrants an individual is in close contact through regular chatting within a  village significantly increase political participation of residents in that  village – more so than family links to migrants. Our findings are consistent  with both improved knowledge about political processes, and increased  intrinsic motivation for political participation being transmitted through  migrant networks. JEL codes: D72, F22, O15

    Keywords: International migration, social networks, political participation, information, effects of emigration in origin countries, sub-Saharan Africa, Mozambique

URL: http://d.repec.org/n?u=RePEc:unl:novafr:wp1701&r=soc

 3. Migration Networks and Location Decisions: Evidence from U.S. Mass Migration

    Bryan Stuart (George Washington University)

    Evan Taylor (University of Chicago)

 This paper examines the effects of birth town migration networks on location  decisions. We study over one million long-run location decisions made during  two landmark migration episodes by African Americans from the U.S. South and  whites from the Great Plains. We develop a new method to estimate the  strength of migration networks for each receiving and sending location. Our  estimates imply that when one randomly chosen African American moves from a  birth town to a destination county, then 1.9 additional black migrants make  the same move on average. For white migrants from the Great Plains, the  average is only 0.4. Networks were particularly important in connecting black  migrants with attractive employment opportunities and played a larger role in  less costly moves.

    Keywords: migration networks, location decisions, social interactions, Great Migration

    JEL: J61 N32 O15 R23 Z13

URL: http://d.repec.org/n?u=RePEc:gwi:wpaper:2017-26&r=soc

 4. The co-evolution of tax evasion, social capital and policy responses: A theoretical approach

    Luigi Bonatti

    Lorenza Lorenzetti

 The dynamic model presented in this paper intends to account for the  evidence, which appears to be particularly significant for Italy, showing  that the incidence of tax evasion in a certain region is negatively  correlated to the level of social capital existing in the region. Beside  including social capital among the determinants of tax evasion, we extend the  model so as to incorporate a mechanism whereby a high level of tax evasion  depresses the formation of social capital, thus helping to explain how  regional differences in the endowment of social capital and in the incidence  of tax evasion co-evolve and why they tend to be highly persistent. The model  seeks also to capture the fact that in a democracy the political  determination necessary to effectively repress tax evasion depends on the  voters‚Äô propensity toward the phenomenon. Indeed, one should expect  that‚Äíin areas where a relatively large (small) number of citizens are tax  cheaters‚Äîthe political consensus in favor of tough policies against tax  evasion tends to be weak (strong) and short (long) lasting. Consistently with  this intuition, the model shows that regions where social capital is  relatively low and tax evasion is relatively high can do better in the long  run (i.e., they can reach a steady state characterized by a higher level of  social capital and a lower level of tax evasion) when tax-enforcement  policies are determined at the national level rather than at the regional  level. The opposite is true for regions where social capital is relatively  high and tax evasion is relatively low.

    Keywords: Tax compliance, dynamic models, multiple equilibria, tax-enforcement policies

    JEL: C63 D53 G18

URL: http://d.repec.org/n?u=RePEc:trn:utwprg:2016/08&r=soc

 5. Civic capital and support for the welfare state

    Roy Cerqueti

    Fabio Sabatini

    Marco Ventura

 We model how the interplay between tax surveillance institutions and civic  capital shapes taxpayers’ support for welfare state. We show that, when tax  surveillance is tight, rational civic-minded individuals express greater  support for welfare spending than uncivic ones. We provide empirical evidence  of these preferences using data from Italy, a country that has long posed a  puzzle for public economists for its limited civic capital and large welfare  state.

    Keywords: Welfare state, redistribution, tax surveillance, trust, civic capital, social capital.

    JEL: H10 H53 D63 D69 Z1

URL: http://d.repec.org/n?u=RePEc:eei:rpaper:eeri_rp_2017_13&r=soc

 6. Fairness and the unselfish demand for redistribution by taxpayers and welfare recipients

    Fabio Sabatini

    Marco Ventura

    Eiji Yamamura

    Luca Zamparelli

 We illustrate how the desire to live in a fair society that rewards  individual effort and hard work triggers an unselfish though rational demand  for redistribution. This leads the well off to prefer higher taxes and the  poor to reject extreme progressivity. We then provide evidence of these  behaviors using a nationally representative survey from Italy. Our empirical  analysis confirms that a stronger aversion to unfair distributive outcomes is  associated with a higher support for redistribution by individuals with high  income and to a lower demand for redistribution by those with low income.

    Keywords: Fairness, income distribution, inequalities, taxation, welfare, redistribution, free-riding, civic capital, social capital.

    JEL: H10 H53 D63 D69 Z1

URL: http://d.repec.org/n?u=RePEc:eei:rpaper:eeri_rp_2017_14&r=soc

 7. The effect of time preferences on altruism

    Davide Dottori

    Caterina Giannetti

 We study the effect of time preference on donations relying on a panel  dataset of Italian households. After developing an intertemporal model to  derive theorethical implications on the relationship between impatience and  altruistic donation, we address the issue empirically, relying on a  quasiexperimental setting. We find that both the amount and the probability  of donating (i.e. altruism) vary non linearly with impatience in  intertemporal choice, eventually declining at higher level of impatience.

 Consistent with previous experimental evidence, these results support the  view that psychological discounting matters for altruistic behaviour and,  more in general, that individual parameters, often not directly observable,  add up to tax policies to determine altruistic behaviours.

    Keywords: Two-limit Tobit, Generalized Propensity Score, Quasi-experiment, Altruism, Discounting

    JEL: C21 D03 D64

URL: http://d.repec.org/n?u=RePEc:pie:dsedps:2017/226&r=soc

 8. Urban Interactions

    Kim, Jun Sung (Monash University)

    Patacchini, Eleonora (Cornell University, USA)

    Picard, Pierre M. (CREA, University of Luxembourg)

    Zenou, Yves (Monash University, Australia)  This paper studies social-tie formation when individuals care about the  geographical location of other individuals. In our model, the intensity of  social interactions can be chosen at the same time as friends. We  characterize the equilibrium in terms of both social interactions and social  capital (the value of social interactions offered by each agent) for a  general distribution of individuals in the urban geographical space. We show  that greater geographical dispersion decreases the incentives to socially  interact. We also show that the equilibrium frequency of interactions is  lower than the efficient one. Using a unique geo-coded dataset of friendship  networks among adolescents in the United States, we estimate the model and  validate that agents interact less than the social first best optimum. Our  policy analysis suggests that, given the same cost, subsidizing social  interactions yields a higher total welfare than subsidizing transportation  costs.

    Keywords: Urban economics; Social interactions; Social capital; Policies

    JEL: R10 R23 Z13

URL: http://d.repec.org/n?u=RePEc:hhs:iuiwop:1192&r=soc

 9. Watch your Words: an Experimental Study on Communication and the Opportunity Cost of Delegation

    Armenak Antinyan (International Academy of Business and Economics, Tianjin University of Finance and Economics)

    Luca Corazzini (Department of Economics, University of Venice \"Ca’Foscari\")

    Elena D\'Agosotino (Department of Economics (SEAM), University of Messina.)

    Filippo Pavesi (Department of Economics (University of Verona))  We consider a principal-agent relationship, and study the interplay between  communication and the opportunity cost of delegation in influencing the  principal’s choice to delegate and the agent’s propensity to prove worthy of  trust. In order to this, we adopt a lost-wallet game in which the agent that  wishes to be trusted can send a free-form message to his counterpart in the  initial stage of the game. We find that communication is effective since it  attenuates the effect of the opportunity cost of delegation on the  principal’s choice. In particular, when the opportunity cost of delegation is  high, communication increases beliefs on the amount that the agent will  return in case of delegation. Moreover, we find that non-precise statements  of intent are more frequent in the presence of lower opportunity costs of  delegation, in which case we document an illusion effect: the agent  incorrectly expects non-precise communication to exert positive effects on  principal’s beliefs and her propensity to delegate.

    Keywords: Communication, Promises, Trust, Delegation, Guilt, Lost-Wallet Game, Language Precision

    JEL: C7 C9 D03 D8

URL: http://d.repec.org/n?u=RePEc:ver:wpaper:18/2017&r=soc

10. Group meeting frequency and borrowers’ repayment performance in microfinance: Evidence from a quasi-natural experiment in South Africa

    Lucia, Dalla Pellegrina

    Angela, De Michele

    Giorgio, Di Maio

    Paolo, Landoni

    Susanna, Parravicini

 A quasi-natural experiment has been carried out in which the Centre Meeting (CM) rules of some centres of a large Microfinance Institution (MFI) that  offers microfinance services, in the form of group lending, were changed. The  study has been carried out at the Small Enterprise Foundation (SEF), an MFI  that operates in South Africa. The frequency of group meetings, organised as  part of the “Monthly Centre Meetings†pilot programme, was reduced from  bimonthly to monthly, and only one member per credit-group was asked to  participate instead of all the group members. The purpose of these changes  was to allow borrowers to save time to spend on their own economic  activities. This new policy was put into force for one year, from May 2014 to  the end of April 2015. After selecting a suitable control group of  micro-borrowers, using Propensity Score Matching techniques, we ran  difference-in-difference (DID) regressions to evaluate the impact of the  policy changes on the client’s repayment and saving behaviour. The obtained  estimates suggest that the change in the policy rules had led to a  deterioration of the customers’ saving balances and had increased delayed  repayments. Text mining techniques, applied to survey data, pointed towards a  lack of trust within the groups, the members of which did not meet frequently  outside the CMs, and this was found to be one of the main causes of failure  of the pilot experiment. We have concluded that group meetings are an  effective tool to stimulate the accumulation of social capital for some  categories of clients, and that those MFIs that wish to implement similar  interventions should be aware of the drawbacks pertaining to borrowers’  behaviour.

    Keywords: Microfinance, Group lending, Group meetings, Quasi-natural experiment, Repayment delay, Savings

    JEL: G21 O15 L31 I25

URL: http://d.repec.org/n?u=RePEc:mib:wpaper:374&r=soc

11. Religiosity may not be a panacea: Importance of prosociality to maintain humanitarian donations

    Shibly Shahrier (Research Institute for Future Design, Kochi University of Technology)

    Koji Kotani (Research Institute for Future Design, Kochi University of Technology)

    Makoto Kakinaka (Graduate School for International Development and Cooperation, Hiroshima University)

 Past literature examines determinants of charitable activities and shows that  prosocial and religious people provide more contribution. However, when an  individual faces opportunities of multiple donations, an interplay among them  in the context of substitutability or complementarity, along with limited  sources extrinsically and intrinsically, can matter on her choice. In this  paper, we study this phenomenon for religious and humanitarian donations by  analyzing a survey-experiment data from a developing country, Bangladesh. Our  result finds that as the degree of religiosity is intensified, people tend to  donate more to religious activities at the expense of humanitarian donation.

 We argue that such different effects of religiosity originate from limited  sources for donations and the substitutability between humanitarian and  religious donations. The analysis also presents that social value orientation  is an important predictor for humanitarian donation, but not for religious  donation, such that prosocials donate more for humanitarian activities than  the proselfs. Our results conclude that to maintain humanitarian donations,  religiosity may not be a panacea but prosociality is rather needed for a  society. Given the argument that ongoing modernization makes people become  less prosocial and thus might dissatisfy the growing needs of humanitarian  activities that require prosocial behaviors, some policy device is necessary  to sustain humanitarian donations in developing countries of Asia and Africa  since they are becoming modernization in a faster speed.

    Keywords: Religious and humanitarian donations, religiosity, prosociality, substitutability of multiple donations

URL: http://d.repec.org/n?u=RePEc:kch:wpaper:sdes-2017-23&r=soc

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