In this issue we feature 7 current papers on the theme of social capital, chosen by Fabio Sabatini (Università degli Studi di Roma “La Sapienza”):

1. Refugees and social capital: Evidence from Northern Lebanon Hager, Anselm; Valasek, Justin
2. Building Inter-Ethnic Cohesion in Schools: An Intervention on Perspective-Taking Sule Alan; Ceren Baysan; Mert Gumren; Elif Kubilay
3. Peer Effects in Networks: A Survey Yann Bramoullé; Habiba Djebbari; Bernard Fortin
4. Know Your Neighbor: The Impact of Social Context on Fairness Behavior Sircar, Neelanjan; Turley, Ty; van der Windt, Peter Cornelis; Voors, Maarten
5. Social Security Expansion and Neighborhood Cohesion: Evidence from Community-Living Older Adults in China Bradley, Elizabeth; Chen, Xi; Tang, Gaojie
6. On free markets, income inequality, happiness and trust Lous, Bjorn
7. Does LGBT inclusion promote national innovative capacity? Vu, Trung V.

1. Refugees and social capital: Evidence from Northern Lebanon Hager, Anselm; Valasek, Justin

Despite numerous studies on the social and political impact of refugees in Europe, we have very little systematic evidence on the impact of refugee settlement on social cohesion in the developing world. Using data gathered in Northern Lebanon, we show that increased salience of the "refugee crisis" decreases natives' trust and prosocial preferences toward refugees, suggesting a negative impact of mass refugee settlement. However, this negative impact is driven exclusively by respondents with no individual exposure to refugees. In fact, despite concerns that refugee settlements may result in local conflict, we find that individual proximity to refugees is positively correlated with trust towards refugees, and that proximity has a positive spillover effect on social capital towards other migrants. This implies that, while the refugee crisis may have had a negative impact on social cohesion, this negative impact is mitigated in areas where natives are in contact with refugees. JEL: F22 H41 D74 Keywords: migration,social capital,experiment,ethnicity Date: 2020 URL: http://d.repec.org/n?u=RePEc:zbw:wzbeoc:spii2020301&r=soc

2. Building Inter-Ethnic Cohesion in Schools: An Intervention on Perspective-Taking Sule Alan (University of Essex); Ceren Baysan (University of Essex); Mert Gumren (Koc University); Elif Kubilay (University of Essex)

We evaluate the impact of an educational program that aims to build inter-ethnic cohesion in schools by developing perspective-taking ability in children. The program takes place in southeastern Turkey, a high-stakes context in which there has been a massive influx of refugees. We measure outcomes that are fundamental to economic interactions and social cohesion, including peer violence, social exclusion, and prosocial behavior. Using randomized variation in program implementation, we find that the program significantly lowers peer violence and victimization on school grounds. It also reduces social exclusion and ethnic segregation in the classroom, measured by inter-ethnic friendship ties. We find that the program is highly effective in enhancing prosocial behavior: Treated students exhibit significantly higher trust, reciprocity, and altruism toward each other. Our results suggest that well-targeted educational strategies can go a long way in building social capital, even in sociopolitically difficult circumstances. JEL: I24 I28 D24 C93 Keywords: social cohesion, education, refugee integration, social exclusion Date: 2020–01 URL: http://d.repec.org/n?u=RePEc:hka:wpaper:2020-009&r=soc

3. Peer Effects in Networks: A Survey Yann Bramoullé; Habiba Djebbari; Bernard Fortin

We survey the recent, fast-growing literature on peer effects in networks. An important recurring theme is that the causal identification of peer effects depends on the structure of the network itself. In the absence of correlated effects, the reflection problem is generally solved by network interactions even in non-linear, heterogeneous models. By contrast, microfoundations are generally not identified. We discuss and assess the various approaches developed by economists to account for correlated effects and network endogeneity in particular. We classify these approaches in four broad categories: random peers, random shocks, structural endogeneity and panel data. We review an emerging literature relaxing the assumption that the network is perfectly known. Throughout, we provide a critical reading of the existing literature and identify important gaps and directions for future research. JEL: C31 C21 C90 Keywords: Social Networks,Peer Effects,Identification,Causal Effects,Randomization,Measurement Errors, Date: 2020–01–28 URL: http://d.repec.org/n?u=RePEc:cir:cirwor:2020s-02&r=soc

4. Know Your Neighbor: The Impact of Social Context on Fairness Behavior Sircar, Neelanjan; Turley, Ty; van der Windt, Peter Cornelis; Voors, Maarten (Wageningen University)

Laboratory experiments offer an opportunity to isolate human behaviors with a level of precision that is often difficult to obtain using other (survey-based) methods. Yet, experimental tasks are often stripped of any social context, implying that inferences may not directly map to real world contexts. We randomly allocate 632 individuals (grouped randomly into 316 dyads) from small villages in Sierra Leone to four versions of the ultimatum game. In addition to the classic ultimatum game, where both the sender and receiver are anonymous, we reveal the identity of the sender, the receiver or both. This design allows us to explore how fairness behavior is affected by social context in a natural setting where players are drawn from populations that are well-acquainted. We find that average offers increase when the receiver's identity is revealed, suggesting that anonymous ultimatum games underestimate expected fair offers. This study suggest that researchers wishing to relate laboratory behavior to contexts in which the participants are well-acquainted should consider revealing the identities of the players during game play. Date: 2020–01–14 URL: http://d.repec.org/n?u=RePEc:osf:socarx:j54ar&r=soc

5. Social Security Expansion and Neighborhood Cohesion: Evidence from Community-Living Older Adults in China Bradley, Elizabeth; Chen, Xi; Tang, Gaojie

Grants and services provided by the government may crowd out informal arrangements, thus weakening informal caring relations and networks. In this paper, we examine the impact of social security expansion on neighborhood cohesion of elders using China’s New Rural Pension Scheme (NRPS), one of the largest existing pension program in the world. Since its launch in 2009, more than 400 million Chinese have enrolled in NRPS. We use two waves of China Health and Retirement Longitudinal Study (CHARLS) to examine the effect of pension receipt on two dimensions of neighborhood cohesion among older adults, i.e. participation in collective recreational activities (e.g., socializing and organizational activities) and altruistic activities (e.g., helping those in need in the community), and the frequencies of these activities. Employing an instrumental variable approach, our empirical strategy addresses the endogeneity of pension receipt via exploiting geographic variation in pension program roll-out. We find evidence that receiving pension only slightly reduces collective recreational activities while significantly crowding out altruistic activities in the communities. JEL: H55 I38 O22 Keywords: neighborhood cohesion,pension,crowd out,diversity Date: 2020 URL: http://d.repec.org/n?u=RePEc:zbw:glodps:453&r=soc

6. On free markets, income inequality, happiness and trust Lous, Bjorn (Tilburg University, School of Economics and Management)

Even though on average Western countries are richer than ever before, an undercurrent of widespread discomfort and uncertainty has been revealed in recent years. This has led to renewed critical interest in the foundations and assumptions of the capitalist economic model. This thesis focuses on the role of inequality in the functioning of the economy. Specifically, three relationships are investigated. The first empirical chapter sets the general context, looking at the effect of economic freedom on (country-level) life satisfaction through income inequality. The second research chapter analyzes the effect of income inequality on trust and inequality in life satisfaction. The third and fourth chapters zoom in on the microeconomic level, discussing how national income inequality relates to individual life satisfaction, and to individual inclination to trust other people. In addition, the differences between different income groups are investigated, as well as between other socio-demographically defined groups. Date: 2020 URL: http://d.repec.org/n?u=RePEc:tiu:tiutis:e2480eed-722b-4e2a-8e29-4d3bec721ea2&r=soc

7. Does LGBT inclusion promote national innovative capacity? Vu, Trung V.

This paper empirically investigates the extent to which the social inclusion of lesbian, gay, bisexual and transgender (LGBT) people matters for technological innovation. The central hypothesis, in particular, postulates that the acceptability of LGBT individuals helps foster human capital skills, thus strengthening innovation. The reverse holds true in societies where significant discrimination against homosexuality prevails. To test this proposition, I perform empirical analysis using data for a world sample of countries. The results indicate that social tolerance toward homosexuality is positively correlated with the economic complexity index, a novel measure of innovation. To achieve causal inference, I conduct several falsification exercises, none of which alters the baseline findings. Further, individual-level analysis, based on data from the World Values Survey, lends strong credence to the international evidence. I also find that LBGT inclusion exerts a positive influence on human capital skills, which is a potential mechanism explaining the baseline findings. JEL: J71 O35 O40 Z13 Keywords: LGBT, innovation, economic complexity, gender discrimination. Date: 2020–01 URL: http://d.repec.org/n?u=RePEc:pra:mprapa:98260&r=soc

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