In this issue we feature 12 current papers on the theme of social capital:

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In this issue we have:

1. Estimating Social Preferences and Gift Exchange at Work - Gautam Rao; Stefano DellaVigna; John List; Ulrike Malmendier
2. The relationship between social capital and health in China - Xue, Xindong; Mo, Erxiao; Reed, W. Robert
3. Culture, Diffusion, and Economic Development - Ani Harutyunyan; Ömer Özak
4. Social Mobility and Stability of Democracy: Re-evaluating De Tocqueville - Daron Acemoglu; Georgy Egorov; Konstantin Sonin
5. Quality of government and social capital as drivers of regional diversification in Europe - Nicola Cortinovis; Jing Xiao; Ron Boschma; Frank van Oort
6. The Interplay of Cultural Aversion and Assortativity for the Emergence of Cooperation - Ennio Bilancini; Leonardo Boncinelli; Jiabin Wu
7. A note on the relative importance of demographic metabolism: the case of trust - Héctor Pifarre i Arolas
8. One mandarin benefits the whole clan: hometown favoritism in an authoritarian regime - Quoc-Anh Do; Kieu-Trang Nguyen; Anh N. Tran Roiser; Anh N. Tran
9. Networks in the Diaspora - Gil S. Epstein; Odelia Heizler (Cohen)
10. Networked by design: Can policy requirements influence organisations’ networking behaviour? Rossi, Federica; Caloffi, Annalisa; Russo, Margherita
11. Endogenous Institutions and Economic Outcomes - Guerriero, Carmine
12. Politics in the Family: Nepotism and the Hiring Decisions of Italian Firms -  Stefano Gagliarducci; Marco Manacorda

           1. Estimating Social Preferences and Gift Exchange at Work

    Gautam Rao

    Stefano DellaVigna

    John List

    Ulrike Malmendier

 We design a model-based field experiment to estimate the nature and magnitude  of workers' social references towards their employers. We hire 446 workers  for a one-time task. Within worker, we vary (i) piece rates; (ii) whether the  work has payoffs only for the worker, or also for the employer; and (iii) the  return to the employer. We then introduce a surprise increase or decrease in  pay (`gifts') from the employer. We find that workers have substantial  baseline social preferences towards their employers, even in the absence of  repeated-game incentives. Consistent with models of warm glow or social  norms, but not of pure altruism, workers exert substantially more effort when  their work is consequential to their employer, but are insensitive to the  precise return to the employer. Turning to reciprocity, we find little  evidence of a response to unexpected positive (or negative) gifts from the  employer. Our structural estimates of the social preferences suggest that, if  anything, positive reciprocity in response to monetary `gifts' may be larger  than negative reciprocity. We revisit the results of previous field  experiments on gift exchange using our model and derive a one-parameter  expression for the implied reciprocity in these experiments.

URL: http://d.repec.org/n?u=RePEc:qsh:wpaper:396911&r=soc

           2. The relationship between social capital and health in China

    Xue, Xindong

    Mo, Erxiao

    Reed, W. Robert

 This paper uses the 2005 and 2006 China General Social Survey (CGSS) to study  the relationship between social capital and health in China. It is the most  comprehensive analysis of this subject to date, both in the sizes of the  samples it analyses, in the number of social capital variables it  investigates, and in its treatment of endogeneity. The authors identify  social trust, social relationships, and social networks as important  determinants of self-reported health. The magnitude of the estimated effects  are economically important, in some cases being of the same size or larger  than the effects associated with age and income. Their findings suggest that  there is scope for social capital to be a significant policy tool for  improving health outcomes in China.

    Keywords: social capital,trust,self-reported health,China,ordered probit

     regression,heteroskedastic ordered probit regression,interaction

     effects,endogeneity

    JEL: I1 I18 P25 O53

URL: http://d.repec.org/n?u=RePEc:zbw:ifwedp:201613&r=soc

           3. Culture, Diffusion, and Economic Development

    Ani Harutyunyan (LICOS - Centre for Institutions and Economic Performance

     at KU Leuven)

    Ömer Özak (Southern Methodist University)  This research explores the effects of culture on technological diffusion and  economic development. It shows that culture's direct effects on development  and barrier effects to technological diffusion are, in general,  observationally equivalent. In particular, using a large set of cultural  measures, it establishes empirically that pairwise differences in  contemporary development are associated with pairwise cultural differences  relative to the technological frontier, only in cases where observational  equivalence holds. Additionally, it establishes that differences in cultural  traits that are correlated with genetic and linguistic distances are  statistically and economically significantly correlated with differences in  economic development. These results highlight the difficulty of disentangling  the direct and barrier effects of culture, while lending credence to the idea  that common ancestry generates persistence and plays a central role in  economic development.

    Keywords: Comparative economic development, economic growth, culture,

     barriers to technological diffusion, genetic distances, linguistic

     distances

    JEL: O10 O11 O20 O33 O40 O47 O57 Z10

URL: http://d.repec.org/n?u=RePEc:smu:ecowpa:1606&r=soc

           4. Social Mobility and Stability of Democracy: Re-evaluating De Tocqueville

    Daron Acemoglu

    Georgy Egorov

    Konstantin Sonin

 An influential thesis often associated with De Tocqueville views social  mobility as a bulwark of democracy: when members of a social group expect to  join the ranks of other social groups in the near future, they should have  less reason to exclude these other groups from the political process. In this  paper, we investigate this hypothesis using a dynamic model of political  economy. As well as formalizing this argument, our model demonstrates its  limits, elucidating a robust theoretical force making democracy less stable  in societies with high social mobility: when the median voter expects to move  up (respectively down), she would prefer to give less voice to poorer  (respectively richer) social groups. Our theoretical analysis shows that in  the presence of social mobility, the political preferences of an individual  depend on the potentially conflicting preferences of her “future selves,” and  that the evolution of institutions is determined through the implicit  interaction between occupants of the same social niche at different points in  time. When social mobility is endogenized, our model identifies new political  economic forces limiting the amount of mobility in society – because the  middle class will lose out from mobility at the bottom and because a  peripheral coalition between the rich and the poor may oppose mobility at the  top.

    JEL: D71 D74

URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:22174&r=soc

           5. Quality of government and social capital as drivers of regional diversification in Europe

    Nicola Cortinovis

    Jing Xiao

    Ron Boschma

    Frank van Oort

 Industrial diversification is considered crucial for economies to prosper.

 Recent studies have shown that regional economies tend to diversify into  sectors that are related to those already present in the region. However, no  study yet has investigated the impact of regional institutions. The objective  of the paper is to bring together the literatures on related diversification  and institutions by analyzing how formal and informal institutions influence  regional diversification. Analyzing 118 European regions in the period 2004  and 2012, we find evidence that institutions matter for regions to diversify  into new industries. Bridging social capital is a key driver of regional  diversification, in addition to relatedness, in contrast to quality of  government in regions. Bonding social capital has a negative impact in  regions with a low quality of government. This suggests that regional  institutions relevant for structural change in regions are predominantly  informal in character rather than formal, and bridging rather than bonding.

    Keywords: regional diversification, social capital, quality of government,

     institutions

    JEL: R11 O14

URL: http://d.repec.org/n?u=RePEc:egu:wpaper:1610&r=soc

           6. The Interplay of Cultural Aversion and Assortativity for the Emergence of Cooperation

    Ennio Bilancini

    Leonardo Boncinelli

    Jiabin Wu

 This paper investigates the emergence of cooperation in a heterogeneous  population. The population is divided into two cultural groups. Agents in the  population are randomly matched in pairs to engage in a prisoner dilemma. The  matching process is assortative, that is, cooperators are more likely to be  matched with cooperators, defectors are more likely to be matched with  defectors. When two agents of different cultures are matched, they suffer a  cost due to their cultural differences. We call such a cost cultural  aversion. We find that when cultural aversion is sufficiently strong, perfect  correlation between culture and behavior emerges: all agents from one  cultural group cooperate, while all agents from the other cultural group  defect.

    Keywords: prisoner dilemma, assortativity, cultural aversion, cooperation,

     type-monomorphic.

    JEL: C72 C73 Z10

URL: http://d.repec.org/n?u=RePEc:mod:recent:121&r=soc

           7. A note on the relative importance of demographic metabolism: the case of trust

    Héctor Pifarre i Arolas (Max Planck Institute for Demographic Research,

     Rostock, Germany)

 Since its initial formulation by Ryder, the theory of demographic metabolism  has developed into a fully quantitative theory and has been applied to a  variety of subjects, ranging from political attitudes to social values. There  is little doubt that the replacement of cohorts is a motor of social  transformation, but how much does it contribute in relation to other forces  of social change? I discuss some of the methodological aspects of the  assessment of the relative magnitude of demographic metabolism using the  trends of trust among individuals in the United States. A meta-analysis of  the results of a variety of well-established models and techniques in  demography and economics confirms the key importance of the process of cohort  replacement on both the levels and trends of trust.

    JEL: J1 Z0

URL: http://d.repec.org/n?u=RePEc:dem:wpaper:wp-2016-003&r=soc

           8. One mandarin benefits the whole clan: hometown favoritism in an authoritarian regime

    Quoc-Anh Do

    Kieu-Trang Nguyen

    Anh N. Tran Roiser

    Anh N. Tran

 We study patronage politics in authoritarian Vietnam, using an exhaustive  panel of 603 ranking officials from 2000 to 2010 to estimate their  promotions’ impact on infrastructure in their hometowns of patrilineal  ancestry. Native officials’ promotions lead to a broad range of hometown  infrastructure improvement. Hometown favoritism is pervasive across all  ranks, even among officials without budget authority, except among elected  legislators. Favors are narrowly targeted towards small communes that have no  political power, and are strengthened with bad local governance and strong  local family values. The evidence suggests a likely motive of social  preferences for hometown.

    Keywords: Favoritism; patronage; authoritarian regime; political

     connection; hometown; infrastructure; disruptive politics

    JEL: N0

URL: http://d.repec.org/n?u=RePEc:ehl:lserod:66422&r=soc

           9. Networks in the Diaspora

    Gil S. Epstein (Bar-Ilan University, IZA, CReAM and Centro Studi Luca

     d'Agliano)

    Odelia Heizler (Cohen) (Tel-Aviv_Yaffo Academic College)  In this paper, we examine possible types of network formation among  immigrants in the diaspora and between those immigrants and the locals in  different countries. We present the model by considering different possible  interactions between immigrants and the new society in their host country.

 Spread of migrants from the same origin in the diaspora may well increase  international trade between the different countries, depending on the types  of networks formed. We present possible applications of network structure on  the country of origin, such as on international trade. We find that when the  size of the diaspora is sufficiently large, the natives in the different  countries will be willing to bear the linking cost with the immigrants  because the possible benefits increase with increasing size of the diaspora.

    Keywords: Immigrants, Networks, Diaspora

    JEL: D85 D74 J61 L14

URL: http://d.repec.org/n?u=RePEc:csl:devewp:389&r=soc

          10. Networked by design: Can policy requirements influence organisations’ networking behaviour?

    Rossi, Federica

    Caloffi, Annalisa

    Russo, Margherita

 An important, but under-researched, question in relation to policies funding  networks of innovators is: what kind of innovation networks should be  supported, if the policy objective is not just to sponsor successful  innovation projects, but also to encourage the participants to form networks  with desirable characteristics? Focusing on a set of policy programmes  implemented by the regional government of Tuscany, in Italy, between 2002 and  2008, aimed at funding networks of collaborating organisations, we  investigate whether the imposition of requirements on the composition of the  networks that would be eligible for funding – in particular, the demand that  networks should comply with minimum size and heterogeneity thresholds –  influenced the participants’ networking behaviour in the context of  successive policy interventions. Our results show that these requirements  immediately affected the size and composition of the project networks that  applied for funding, although not always in the intended direction. However,  these effects did not extend to the successive periods, when those  requirements were no longer in force. This suggests that the imposition of  policy requirements, per se, is unlikely to induce persistent changes in  organizations’ networking behaviour. Other approaches such as implementing  outreach actions in order to encourage new organisations to participate in  existing innovation networks and to form new ones, and additional measures  designed to foster learning opportunities for the participants, might be more  effective tools to influence the networking behaviour of participating  organisations.

    Keywords: Innovation networks, innovation policy, policy requirements, networking behaviour, behavioural effects of policy

    JEL: O31 R5

URL: http://d.repec.org/n?u=RePEc:pra:mprapa:69327&r=soc

          11. Endogenous Institutions and Economic Outcomes.

    Guerriero, Carmine

 This paper evaluates the relative importance of a "culture of cooperation,"

 understood as the implicit reward from cooperating in prisoner's dilemma and  investment types of activities, and "inclusive political institutions," which  enable the citizenry to check the executive authority. I divide Europe into

 120 km X 120 km grid cells, and I exploit exogenous variation in both  institutions driven by persistent medieval history. To elaborate, I document  strong first-stage relationships between present-day norms of trust and  respect and the severity of consumption risk-i.e., climate volatility-over  the 1000-1600 period and between present-day regional political autonomy and  the factors that raised the returns on elite-citizenry investments in the  Middle Ages, i.e., the terrain ruggedness and the direct access to the coast.

 Using this instrumental variables approach, I show that only culture has a  first order effect on development, even after controlling for country fixed  effects, medieval innovations, the present-day role of medieval geography,  and the factors modulating the impact of institutions. Crucially, the  excluded instruments have no direct impact on development, and the effect of  culture holds within pairs of adjacent grid cells with different medieval  climate volatility. An explanation for these results is that culture, but not  a more inclusive political process, is necessary to produce public-spirited  politicians and push voters to punish political malfeasance. Micro-evidence  from Italian Parliament data supports this idea.

    Keywords: Geography; Culture; Democracy; Development; Political Accountability.

    JEL: D7 H1 O1 Z1

URL: http://d.repec.org/n?u=RePEc:pra:mprapa:70879&r=soc

          12. Politics in the Family: Nepotism and the Hiring Decisions of Italian Firms

    Stefano Gagliarducci

    Marco Manacorda

 In this paper we investigate the effect of family connections to politicians  on individuals' labor market outcomes. We combine data for Italy over almost  three decades from longitudinal social security records on a random sample of  around 1 million private sector employees with the universe of around 500,000  individuals ever holding political office, and we exploit information  available in both datasets on a substring of each individual's last name and  municipality of birth in order to identify family ties. Using a diff-in-diff  analysis that follows individuals as their family members enter and leave  office, and correcting for the measurement error induced by our fuzzy  matching method, we estimate that the monetary return to having a politician  in the family is around 3.5 percent worth of private sector earnings and that  each politician is able to extract rents for his family worth between one  fourth and one full private sector job per year. The effect of nepotism is  long lasting, extending well beyond the period in office. Consistent with the  view that this is a technology of rent appropriation on the part of  politicians, the effect increases with politicians' clout and with the  resources available in the administration where they serve.

    Keywords: nepotism, family connections, politics, rent appropriation

    JEL: D72 D73 H72 J24 J30 M51

URL: http://d.repec.org/n?u=RePEc:cep:cepdps:dp1422&r=soc

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