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”):

1. Media and Social Capital Filipe R. Campante; Ruben Durante; Andrea Tesei

2. What Feeds on What? Networks of Interdependencies between Culture and Institutions Nadia von Jacobi; Vito Amendolagine

3. Do Social Norms Trump Rational Choice in Voluntary Climate Change Mitigation? Multi-Country Evidence of Social Tipping Points Heinz Welsch

4. Political identity: experimental evidence on anti-Americanism in Pakistan Bursztyn, Leonardo; Callen, Mike; Ferman, Bruno; Gulzar, Saad; Hasanain, Ali; Yuchtman, Noam

5. Elections, Political Connections and Cash Holdings: Evidence from Local Assemblies Adeabah, David; Andoh, Charles; Asongu, Simplice; Akomea-Frimpong, Isaac

6. Egocentric Norm Adoption Thomas Neuber

7. Is Social Capital Valuable? Evidence from Mergers and Acquisitions Jo-Ann Suchard; Giang Nguyen; Yuelin Wang

8. The Role of Social Connectedness: Evidence from Mergers and Acquisitions Giang Nguyen; Hannah Nguyen; Hung Pham

9. Gender identity and quality of employment Estefanía Galván

10. Interactions amongst gender norms: Evidence from US couples Estefanía Galván; Cecilia García-Peñalosa

11. Perceptions of Racial Gaps, their Causes, and Ways to Reduce Them Alberto Alesina; Matteo F. Ferroni; Stefanie Stantcheva

1. Media and Social Capital Filipe R. Campante; Ruben Durante; Andrea Tesei We survey the empirical literature in economics on the impact of media technologies on social capital. Motivated by a simple model of information and collective action, we cover a range of different outcomes related to social capital, from social and political participation to interpersonal trust, in its benign and destructive manifestations. The impact of media technologies hinges on their content ("information" vs "entertainment"), their effectiveness in fostering coordination, and the networks they create, as well as individual characteristics and media consumption choices. JEL: D71 D72 D74 D83 D84 Z13 Date: 2021–09 URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:29230&r=&r=soc

2. What Feeds on What? Networks of Interdependencies between Culture and Institutions Nadia von Jacobi; Vito Amendolagine We propose a methodology inspired by ecology to map the complex interdepen- dencies between cultural and institutional factors - controlling for other socioeco- nomic and structural characteristics. We characterize interdependencies as asym- metric symbiotic relations, distinguishing between ‘hosts’ that nurture other factors and ‘symbionts’ that reversely feed on the former. We use correlation network anal- ysis to compute a map of multiple such interdependencies for Brazil, which has a vast territory, internally diversified historical paths and a multilevel governance structure. We set the empirical analysis at the municipality level and find that in- stitutional factors tend to be symbionts, whereas cultural factors tend to be hosts. However, our results also show that institutions assume multiple roles within a com- plex network of interdependencies, often becoming themselves habitat for others or transmittors of indirect effects. JEL: O17 O43 C18 D02 H70 Keywords: Institutions, Culture, Symbiosis, Correlation network analysis, Brazil Date: 2021 URL: http://d.repec.org/n?u=RePEc:trn:utwprg:2021/13&r=&r=soc

3. Do Social Norms Trump Rational Choice in Voluntary Climate Change Mitigation? Multi-Country Evidence of Social Tipping Points Heinz Welsch (University of Oldenburg, Department of Economics) The rational choice model of voluntary public good provision predicts that an individual’s contribution to climate change mitigation responds negatively to larger contributions by others whereas social norm theory maintains that one’s own contribution is positively related to that of others. This paper tests the competing hypotheses empirically using representative data for about 30,000 individuals from 23 European countries. The paper finds that, up to a threshold percentage of others perceived to engage in mitigation, individuals’ willingness to engage in mitigation themselves is lower the more other individuals are perceived to engage in such behavior, whereas the relationship is positive when the threshold is passed. Since the actual percentage of others perceived to engage in mitigation is lower than the estimated threshold (30 to 56 percent) in a number of countries, marginal increases in the percentage of others perceived to behave in a climate-friendly way may backfire by enhancing free-rider behavior. For the social norm to take grip, policy-induced non-marginal increases of perceptions may be warranted in such cases. Given that the actual level of the relevant behavior is large relative to the perceived level, informing people about the actual level constitutes a sufficiently large change to trigger an increase in the behavior studied. Keywords: climate change; social norm; rational choice; voluntary public good provision; social tipping point Date: 2021–09 URL: http://d.repec.org/n?u=RePEc:old:dpaper:437&r=&r=soc

4. Political identity: experimental evidence on anti-Americanism in Pakistan Bursztyn, Leonardo; Callen, Mike; Ferman, Bruno; Gulzar, Saad; Hasanain, Ali; Yuchtman, Noam We identify Pakistani men’s willingness to pay to preserve their anti-American identity using two experiments imposing clearly specified financial costs on anti-American expression, with minimal consequential or social considerations. In two distinct studies, one-quarter to one-third of subjects forgo payments from the U.S. government worth around one-fifth of a day’s wage to avoid an identity-threatening choice: anonymously checking a box indicating gratitude toward the U.S. government. We find sensitivity to both payment size and anticipated social context: when subjects anticipate that rejection will be observable by others, rejection falls suggesting that, for some, social image can outweigh self-image. JEL: P16 D00 C90 Date: 2020–10–01 URL: http://d.repec.org/n?u=RePEc:ehl:lserod:101465&r=&r=soc

5. Elections, Political Connections and Cash Holdings: Evidence from Local Assemblies Adeabah, David; Andoh, Charles; Asongu, Simplice; Akomea-Frimpong, Isaac We examine the relationship between elections, political connections, and cash holdings in Ghanaian local assemblies. Using a panel dataset of 179local assemblies over a period 2012 to 2017, a panel regression and the generalized method of moments estimation techniques was employed for the analysis. We find that local assemblies hold less cash during election years, which suggests that election may be one of the potential factors to mitigate agency conflict in weak governance environment. Further, we demonstrate that local assemblies that have political connections hold less cash; however, political uncertainty makes these entities conducive to agency problems than their non-connected peers because they hold more cash. Additional analysis indicates that one year prior to elections, managerial conservatism kicks-in and leads managers to hold more cash in local assemblies that have political connections, which continues and becomes more pronounced in election years. Our results have implications for regulations on the cash management practices of local assemblies. JEL: C1 O1 Keywords: agency problem; cash holdings; generalized method of moments; panel regression; political connections Date: 2021–01 URL: http://d.repec.org/n?u=RePEc:pra:mprapa:109836&r=&r=soc

6. Egocentric Norm Adoption Thomas Neuber (University of Bonn) Social norms pervade human interaction, but their demands are often in conflict. To understand behavior, it is thus crucial to know how individuals resolve normative tradeoffs. This paper proposes that sincere judgments about the relative importance of conflicting norms are shaped by personal interest. We show that people tend to follow norms from which they benefit themselves, even in contexts where their own decisions only affect others. In a (virtual) laboratory experiment, each subject makes two decisions over allocations of points within a group of two other participants. The sets of possible allocations entail different normative tradeoffs, and subjects have no personal stakes in their own decisions. However, they are affected by others' decisions: each subject is part of a group, and the members of different groups simultaneously decide over others' allocations along a circle. We find that subjects' decisions are biased towards the normative principles aligned with their own interests, thereby favoring other players whenever these share those interests. Subjects' beliefs about the choices made by others suggest a largely unconscious mechanism. Moreover, survey answers indicate that the effects are driven by self-centered reasoning: subjects who report pronounced perspective-taking are less biased. Keywords: egocentrism, experiment, social norms Date: 2021–09 URL: http://d.repec.org/n?u=RePEc:ajk:ajkdps:116&r=&r=soc

7. Is Social Capital Valuable? Evidence from Mergers and Acquisitions Jo-Ann Suchard (UNSW Business School, University of New South Wales Sydney.); Giang Nguyen (School of Political Science and Economics, Waseda University.); Yuelin Wang (School of Political Science and Economics, Waseda University.) Using comprehensive social capital data of U.S. counties from the Social Capital Project, we show evidence that the county-level social capital where the acquirer is located is positively related to the acquirer’s announcement returns. This finding withstands alternative model specifications and remains robust to endogeneity concerns. We also document that social capital has a more pronounced effect on the acquirer’s announcement returns when the supermajority to approve a merger, acquirer size, the deal size, and the ratio of stock payment are larger and the percentage of blockholder ownership is smaller. Additionally, we find that social capital creates more synergies, enhances acquirers’ long-term performance, and shortens deal completion duration. Overall, our results support the shareholder value maximization view that social capital constrains managerial opportunistic and selfserving behaviors, which leads to better acquisition outcomes. JEL: G34 Z13 Keywords: Social Social Capital, Merger and Acquisition, Shareholder Value Maximization. Date: 2021–09 URL: http://d.repec.org/n?u=RePEc:wap:wpaper:2117&r=&r=soc

8. The Role of Social Connectedness: Evidence from Mergers and Acquisitions Giang Nguyen (Faculty of Political Science and Economics, Waseda University 1-6-1 Nishi-Waseda, Shinjuku, Tokyo 169-8050, Japan); Hannah Nguyen (Department of Banking and Finance, Monash University Caulfield East, Victoria 3145, Australia); Hung Pham (Department of Banking and Finance, Monash University Caulfield East, Victoria 3145, Australia) Using a comprehensive dataset of social network ties between U.S. counties, we document higher announcement returns for acquirers that are more socially proximate to their targets. Our findings are robust to the inclusion of geographical proximity and withstand endogeneity concerns. Consistent with the information asymmetry hypothesis, we show that the effect of social connectedness is more pronounced when targets have high information opacity, as proxied by target status, analyst coverage, bid–ask spreads, R&D, and high-tech classifications. In addition, social connectedness lowers advisory fees, reduces deal premiums, and yields better acquirer long-term performance. Keywords: Social connectedness; merger and acquisition; information asymmetry Date: 2021–09 URL: http://d.repec.org/n?u=RePEc:wap:wpaper:2116&r=&r=soc

9. Gender identity and quality of employment Estefanía Galván (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía) Studies for high-income countries have shown that the prescription that a man should earn more than his wife holds back women’s performance in the labour market, evidencing the importance of gender identity norms in explaining persistent gender gaps. Using data on couples in Uruguay for the period 1986-2016, this paper analyses behavioural responses to the male breadwinner norm, investigating the role of job informality as an additional mechanism of response to gender norms. My results show that the higher the probability that the wife earns more than her husband, the less likely she is to engage in a formal job, providing evidence that gender norms affect not only the quantity of labour supply (i.e. labour force participation and hours of work), but also the quality of jobs in which women are employed. Moreover, I also identify meaningful effects of the norm on men: those with lower potential earnings than their wives react to the norm by self-selecting into better-paid formal jobs. Not considering these effects would lead to underestimate the consequences of gender norms on labour market inequalities in the context of developing countries. JEL: D13 J16 J22 Keywords: gender identity, social norms, informality, labour supply, housework. Date: 2021–08 URL: http://d.repec.org/n?u=RePEc:ulr:wpaper:dt-14-21&r=&r=soc

10. Interactions amongst gender norms: Evidence from US couples Estefanía Galván (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía); Cecilia García-Peñalosa (Aix-Marseille Université (Francia).CNRS, EHESS, AMSE, CEPR & CESifo) Gendered norms have major implications for women’s labor market outcomes. Notably, a recent literature finds that child-rearing norms and the prescription that the husband should be the main breadwinner lead to behavioral changes affecting women's labor supply. Motherhood reduces participation and hours of market work, while women who earn more than their husbands have been shown to react in ways that reverse that gap. In this paper we use panel data for the US to examine to what extent these two different norms interact. We start by asking whether child-rearing norms affect women who are the main breadwinner and those who are not in the same way, and then turn to how mothers and childless women react when breaking the male-as-the-breadwinner norm. Our results show that the breadwinner norm has an effect only on mothers, suggesting that the salience of gender norms may depend on the household's context. Concerning child-rearing, we find that although the labor supply of women who earn more than their husbands initially responds to motherhood less than that of secondary earners, the two groups converge after 10 years. Moreover, women in the former category exhibit a disproportionately large increases in the share of housework they perform after becoming mothers. These results indicate that norms still prevail over considerations of comparative advantage, and that the presence of children pushes women to seek to compensate breaking a norm by adhering to another one. JEL: D10 J16 J22 Keywords: gender identity norms, female labor supply, motherhood, relative income Date: 2021–08 URL: http://d.repec.org/n?u=RePEc:ulr:wpaper:dt-15-21&r=&r=soc

11. Perceptions of Racial Gaps, their Causes, and Ways to Reduce Them Alberto Alesina; Matteo F. Ferroni; Stefanie Stantcheva Using new large-scale survey and experimental data, we investigate how respondents perceive racial inequities between Black and white Americans, what they believe causes them, and what interventions, if any, they think should be implemented to reduce them. We intentionally oversample Black respondents, cover many cities in the US, and survey both adults and very young people aged 13 to 17. In the experimental parts, we consider the causal impact of information on racial inequities (such as the evolution of the Black-white earnings gap or the differences in mobility for Black and white children) and explanations for these inequities (i.e., the deep-seated roots and long-lasting consequences of systemic racism) on respondents' views. Although there is heterogeneity in how respondents perceive the magnitude of current racial gaps in economic conditions and opportunities, the biggest discrepancies are in how they explain them. There is a stark partisan gap among white respondents, particularly in the perceived causes of racial inequities and what should be done about them. White Democrats and Black respondents are much more likely to attribute racial inequities to adverse past and present circumstances and want to act on them with race-targeted and general redistribution policies. At the same time, white Republicans are more likely to attribute racial gaps to individual actions. These views are already deeply entrenched in teenagers based on their race and their parents' political affiliation. A policy decomposition shows that the perceived causes of racial inequities correlate most strongly with support for race-targeted or general redistribution policies, a finding confirmed by the experimental results. JEL: D31 D72 H23 H24 H41 J15 P16 Date: 2021–09 URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:29245&r=&r=soc

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