In this issue we feature 10 current papers on the theme of social capital:

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In this issue we have:

1. Trust in banks - Fungáčová, Zuzana; Hasan, Iftekhar; Weill, Laurent
2. Cooperation, Punishment and Organized Crime: A Lab-in-the-Field Experiment in Southern Italy - Nese, Annamaria; O'Higgins, Niall; Sbriglia, Patrizia; Scudiero, Maurizio
3. Networks and the macroeconomy: an empirical exploration - Acemoglu, Daron; Akcigit, Ufuk; Kerr, William R.
4. Social Networks and Housing Markets - Michael Bailey; Ruiqing Cao; Theresa Kuchler; Johannes Stroebel
5. Image versus Information: Changing Societal Norms and Optimal Privacy - Ali, S. Nageeb; Benabou, Roland
6. Social capital and debt contracting: evidence from bank loans and public bonds - Hasan, Iftekhar; Hoi, Chun-Keung (Stan); Wu, Qiang; Zhang, Hao
7. Tie creation versus tie persistence in cluster knowledge networks - Sándor Juhász; Balázs Lengyel
8. Who bears the burden of bribery? Evidence from Public Service Delivery in Kenya - Mbate, Michael
9. Social Influence Bias in Online Ratings: A Field Experiment - S. Cicognani; P. Figini; M. Magnani
10. Social diffusion of religious values within families: Conceptual and methodological considerations - Arránz Becker, Oliver; Lois, Daniel; Steinbach, Anja

 1. Trust in banks

    Fungáčová, Zuzana

    Hasan, Iftekhar

    Weill, Laurent

 ​Trust in banks is considered essential for an effective financial system,  yet little is known about what determines trust in banks. Only a handful of  single-country studies discuss the topic, so this paper aims to fill the gap  by providing a cross-country analysis on the level and determinants of trust  in banks. Using World Values Survey data covering 52 countries during the  period 2010–2014, we observe large cross-country differences in trust in  banks and confirm the influence of several sociodemographic indicators. Our  main findings include: women tend to trust banks more than men; trust in  banks tends to increase with income, but decrease with age and education;  access to television enhances trust, while internet access erodes trust; and  religious, political, and economic values may affect trust in banks. Notably,  religious individuals tend to put greater trust in banks, but differences are  observed across denominations. The holding of pro-market economic views is  also associated with greater trust in banks.

    Keywords: banking, trust, institutions, religion

    JEL: G21 O16 Z1

URL: http://d.repec.org/n?u=RePEc:bof:bofitp:2016_007&r=soc

 2. Cooperation, Punishment and Organized Crime: A Lab-in-the-Field Experiment in Southern Italy

    Nese, Annamaria (University of Salerno)

    O'Higgins, Niall (ILO International Labour Organization)

    Sbriglia, Patrizia (University of Naples II)

    Scudiero, Maurizio (Ministry of Justice, Italy)  This paper reports the results of an experimental investigation which allows  a deeper insight into the nature of social preferences amongst organized  criminals and how these differ from "ordinary" criminals on the one hand and  from the non‐criminal population in the same geographical area on the other.

 We provide experimental evidence on cooperation and response to sanctions by  running Prisoner's Dilemma and Third Party Punishment games on three  different pools of subjects; students, 'Ordinary Criminals' and Camorristi  (Neapolitan 'Mafiosi'). The latter two groups being recruited from within  prisons. We are thus able to separately identify 'Prison' and 'Camorra'

 effects. Camorra prisoners show a high degree of cooperativeness and a strong  tendency to punish, as well as a clear rejection of the imposition of  external rules even at significant cost to themselves. In contrast, ordinary  criminals behave in a much more opportunistic fashion, displaying lower  levels of cooperation and, in the game with Third Party punishment, punishing  less as well as tending to punish cooperation (almost as much) as defection.

 Our econometric analyses further enriches the analysis demonstrating inter  alia that individuals' locus of control and reciprocity are associated with  quite different and opposing behaviours amongst different participant types;  a strong sense of self‐determination and reciprocity both imply a higher  propensity to cooperate and to punish for both students and Camorra inmates,  but quite the opposite for ordinary criminals, further reinforcing the  contrast between the behaviour of ordinary criminals and the strong internal  mores of Camorra clans.

    Keywords: experimental economics, economics of crime, models of identity,

     prisoner's dilemma, third party punishment

    JEL: A13 D63 D23 C92 K42 Z13

URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp9901&r=soc

 3. Networks and the macroeconomy: an empirical exploration

    Acemoglu, Daron

    Akcigit, Ufuk

    Kerr, William R.

 The propagation of macroeconomic shocks through input-output and geographic  networks can be a powerful driver of macroeconomic fluctuations. We first  exposit that in the presence of Cobb-Douglas production functions and  consumer preferences, there is a specific pattern of economic transmission  whereby demand-side shocks propagate upstream (to input-supplying industries)  and supply-side shocks propagate downstream (to customer industries) and that  there is a tight relationship between the direct impact of a shock and the  magnitudes of the downstream and the upstream indirect effects. We then  investigate the short-run propagation of four different types of  industry-level shocks: two demand-side ones (the exogenous component of the  variation in industry imports from China and changes in federal spending) and  two supply-side ones (TFP shocks and variation in knowledge/ideas coming from  foreign patenting). In each case, we find substantial propagation of these  shocks through the input-output network, with a pattern broadly consistent  with theory. Quantitatively, the network-based propagation is larger than the  direct effects of the shocks. We also show quantitatively large effects from  the geographic network, capturing the fact that the local propagation of a  shock to an industry will fall more heavily on other industries that tend to  collocate with it across local markets. Our results suggest that the  transmission of various di¤erent types of shocks through economic networks  and industry interlinkages could have first-order implications for the  macroeconomy.

    Keywords: economic fluctuations, geographic collocation, input-output linkages, networks, propagation, shocks

    JEL: E32

URL: http://d.repec.org/n?u=RePEc:bof:bofrdp:2015_025&r=soc

 4. Social Networks and Housing Markets

    Michael Bailey

    Ruiqing Cao

    Theresa Kuchler

    Johannes Stroebel

 We document that the recent house price experiences within an individual’s  social network affect her perceptions of the attractiveness of property  investments, and through this channel have large effects on her housing  market activity. Our data combine anonymized social network information from  Facebook with housing transaction data and a survey. We first show that in  the survey, individuals whose geographically-distant friends experienced  larger recent house price increases consider local property a more attractive  investment, with bigger effects for individuals who regularly discuss such  investments with their friends. Based on these findings, we introduce a new  methodology to document large effects of housing market expectations on  individual housing investment decisions and aggregate housing market  outcomes. Our approach exploits plausibly-exogenous variation in the recent  house price experiences of individuals’ geographically-distant friends as  shifters of those individuals’ local housing market expectations. Individuals  whose friends experienced a 5 percentage points larger house price increase  over the previous 24 months (i) are 3.1 percentage points more likely to  transition from renting to owning over a two-year period, (ii) buy a 1.7  percent larger house, (iii) pay 3.3 percent more for a given house, and (iv)  make a 7% larger downpayment. Similarly, when homeowners’ friends experience  less positive house price changes, these homeowners are more likely to become  renters, and more likely to sell their property at a lower price. We also  find that when individuals observe a higher dispersion of house price  experiences across their friends, this has a negative effect on their housing  investments. Finally, we show that these individual-level responses aggregate  up to affect county-level house prices and trading volume. Our findings  suggest that the house price experiences of geographically-distant friends  might provide a valid instrument for local house price growth.

    JEL: D12 D14 D84 G12 R21

URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:22258&r=soc

 5. Image versus Information: Changing Societal Norms and Optimal Privacy

    Ali, S. Nageeb (Pennsylvania State University)

    Benabou, Roland (Princeton University)  We analyze the costs and benefits of using social image to foster virtuous  behavior. A Principal seeks to motivate reputation-conscious agents to supply  a public good. Each agent chooses how much to contribute based on his own mix  of public-spiritedness, private signal about the value of the public good,  and reputational concern for appearing prosocial. By making individual  behavior more visible to the community the Principal can amplify reputational  payoffs, thereby reducing free-riding at low cost. Because societal  preferences constantly evolve, however, she knows only imperfectly both the  social value of the public good (which matters for choosing her own  investment, matching rate or legal policy) and the importance attached by  agents to social esteem and sanctions. Increasing publicity makes it harder  for the Principal to learn from what agents do (the "descriptive norm") what  they really value (the "prescriptive norm"), thus presenting her with a  tradeoff between incentives and information aggregation. We derive the  optimal degree of privacy/publicity and matching rate, then analyze how they  depend on the economy's stochastic and informational structure. We show in  particular that in a fast-changing society (greater variability in the  fundamental or the image-motivated component of average preferences), privacy  should generally be greater than in a more static one.

    Keywords: social norms, privacy, transparency, incentives, esteem, reputation, shaming punishments, conformity, societal change, culture

    JEL: D62 D64 D82 H41 K42 Z13

URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp9947&r=soc

 6. Social capital and debt contracting: evidence from bank loans and public bonds

    Hasan, Iftekhar

    Hoi, Chun-Keung (Stan)

    Wu, Qiang

    Zhang, Hao

 We find that firms headquartered in U.S. counties with higher levels of  social capital incur lower bank loan spreads. This finding is robust to using  organ donation as an alternative social-capital measure and incremental to  the effects of religiosity, corporate social responsibility, and tax  avoidance. We identify the causal relation using companies with a  social-capital-changing headquarter relocation. We also find that  high-social-capital firms face loosened nonprice loan terms, incur lower  at-issue bond spreads, and prefer bonds over loans. We conclude that debt  holders perceive social capital as providing environmental pressure  constraining opportunistic firm behaviors in debt contracting.

    Keywords: social capital, cooperative norm, moral hazard, cost of bank loans, public bonds

    JEL: G21 G32 Z13

URL: http://d.repec.org/n?u=RePEc:bof:bofrdp:2015_021&r=soc

 7. Tie creation versus tie persistence in cluster knowledge networks

    Sándor Juhász

    Balázs Lengyel

 Knowledge networks in industrial clusters are frequently analyzed but we know  very little about creation and persistence of ties in these networks. We  argue that tie creation primarily depends on opportunities and thus the  position ofactors in the network and in space; while tie persistence is  influenced by the value of the tie. Accordingly, results from a Hungarian  printing and paper product cluster suggest that reciprocity, triadic closure,  and geographical proximity between firms increase the probability of tie  creation. Tie persistence is positively affected by technological proximity  between firms and the number of their extra-regional ties.

    Keywords: knowledge networks, clusters, network dynamics, stochastic actor-oriented models

    JEL: D85 L14 R11 O31

URL: http://d.repec.org/n?u=RePEc:egu:wpaper:1613&r=soc

 8. Who bears the burden of bribery? Evidence from Public Service Delivery in Kenya

    Mbate, Michael

 This paper empirically examines how an individual’s economic, social and  political capital affects the propensity to make bribe payments in exchange  for public services. Using an individual-level survey on bribes, the  econometric results suggest that the burden of bribery is borne by the poor,  but substantially decreases when institutions that constrain bureaucratic  corruption are strong and effective. The results also show that bribery  incidences decrease when social capital is high but increase when political  networks are prevalent. These findings support the need to combine  anti-corruption reforms with poverty reduction strategies in order to foster  equity in public services provision in Kenya.

    Keywords: Poverty, Bribery, Institutions

    JEL: H41 O55

URL: http://d.repec.org/n?u=RePEc:pra:mprapa:71654&r=soc

 9. Social Influence Bias in Online Ratings: A Field Experiment

    S. Cicognani

    P. Figini

    M. Magnani

 The aim of this paper is to study the empirical phenomenon of rating bubbles,  i.e. clustering on extremely positive values in e-commerce platforms and  rating web sites. By means of a field experiment that exogenously manipulates  prior ratings for a hotel in an important Italian tourism destination, we  investigate whether consumers are influenced by prior ratings when evaluating  their stay (i.e., social influence bias). Results show that positive social  influence exists, and that herd behavior is asymmetric: information on prior  positive ratings has a stronger influence on consumers’ rating attitude than  information on prior mediocre ratings. Furthermore, we are able to exclude  any brag-or-moan effect: the behavior of frequent reviewers, on average, is  not statistically different from the behavior of consumers who have never  posted ratings online. Yet, non-reviewers exhibit a higher influence to  excellent prior ratings, thus lending support to the social influence bias  interpretation. Finally, also repeat customers are affected by prior ratings,  although to a lesser extent with respect to new customers.

    JEL: C93 D83 L86 Z31

URL: http://d.repec.org/n?u=RePEc:bol:bodewp:wp1060&r=soc

10. Social diffusion of religious values within families: Conceptual and methodological considerations

    Arránz Becker, Oliver

    Lois, Daniel

    Steinbach, Anja

 Family members create for each other the social context in which family  behavior and personality development take place. The importance of social  influence in families is evidenced empirically by family members' great  similarity on a wide variety of characteristics. Focusing on intrafamily  convergence on religiosity, the study discuses empirical methods of dyadic  analysis and illustrates their use with an analysis of horizontal intracouple  alignment and vertical intergenerational transmission. In addition to the  finding that experiences during religious socialization in the parental home  have a stronger impact than partner influences in adulthood, the analyses  show that social context effects are stronger when the interaction dyad is  more cohesive, as measured by, for example, relationship quality.

 Familienmitglieder repräsentieren füreinander jeweils gegenseitig den  sozialen Kontext, innerhalb dessen sich familiales Handeln und individuelle  Persönlichkeitsentwicklung abspielen. Soziale Einflüsse in Familien äußern  sich empirisch in einer überzufälligen Ähnlichkeit der Familienmitglieder  hinsichtlich einer großen Bandbreite von Merkmalen. Der vorliegende Beitrag  fokussiert auf die intrafamiliale Homogenisierung hinsichtlich Religiosität,  wobei in einem empirischen Datenbeispiel horizontale  Paar-Angleichungsprozesse sowie vertikale intergenerationale  Transmissionsprozesse untersucht werden. Neben dem Befund, dass  Sozialisationserfahrungen im Elternhaus bedeutsamer sind als spätere  Partnereinflüsse, zeigen die Analysen, dass soziale Kontexteffekte umso  stärker ausfallen, je größer die Kohäsion in der jeweiligen Interaktionsdyade  ist; hier operationalisiert über die Beziehungsqualität.

Keywords: Intergenerational Transmission,Homogamy,Religion,Dyadic Analysis,Socialization,Social Context,Intergenerationale Transmission,Homogamie,Religion,Dyadische Datenanalyse,Sozialisation,sozialer Kontext

URL: http://d.repec.org/n?u=RePEc:zbw:udesoz:201601&r=soc

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