In this issue we feature 11 current papers on the theme of social capital:

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In this issue we have:

1. Cultural Transmission and Socialization Spillovers in Education - Del Bello, Carlo; Panebianco, Fabrizio; Verdier, Thierry; Zenou, Yves
2. Does Experience Affect Fairness and Reciprocity in Lab Experiments? Tiziana Medda; Vittorio Pelligra; Tommaso Reggiani
3. Migrant Networks and Trade: The Vietnamese Boat People as a Natural Experiment - Parsons, Christopher; Vézina, Pierre-Louis
4. Gender-Oriented Languages and Female Labour Force Participation: Evidence from Sub-Saharan Africa - Michelle Rao
5. Innovation, Pricing and Targeting in Networks - Fabrizio Panebianco; Thierry Verdier; Yves Zenou
6. Where to Look for the Morals in Markets? Sutter, Matthias; Huber, Jürgen; Kirchler, Michael; Stefan, Matthias
7. Does Empathy Beget Guile? Experimental Evidence - Chen, Daniel L.
8. Social Ties of University Students: Evidence from a Longitudinal Survey in Russia - Ekaterina V. Krekhovets; Liudmila A. Leonova
9. In God We Learn? Religions' Universal Messages, Context-Specific Effects, and Minority Status - Méon, Pierre-Guillaume; Tojerow, Ilan
10. Cooperation among behaviorally heterogeneous players in social dilemma with stay of leave decisions - Xiaochuan Huang; Takehito Masuda; Yoshitaka Okano; Tatsuyoshi Saijo
11. Young Adults Living with Their Parents and the Influence of Peers - Adamopoulou, Effrosyni (Efi); Kaya, Ezgi

 1. Cultural Transmission and Socialization Spillovers in Education

    Del Bello, Carlo

    Panebianco, Fabrizio

    Verdier, Thierry

    Zenou, Yves

 We propose a model of the intergenerational transmission of education where  children belong to either high-educated or low-educated families. Children  choose the intensity of their social activities while parents decide how much  educational effort to exert. We characterize the equilibrium and show under  which condition cultural substitution or complementarity emerges. There is  cultural substitution (complementarity) if parents decrease (increase) their  education effort when their child socializes more with other children of the  same type. By structurally estimating our model to the AddHealth data in the  United States, we find that there is cultural complementarity for  high-educated parents and cultural substitution for low-educated parents.

 This means that, for both parents, the more their children interact with kids  from high-educated families, the more parents exert educational effort. We  also perform some policy simulations. We find that policies aiming at mixing  high and low educated children perform well in terms of average educational  outcomes. We also show that a policy that gives vouchers to children from  high-educated families have a positive and significant impact on the  educational outcomes of all children while a policy that gives vouchers to  children from low-educated families has a negative effect on the outcomes of  both groups.

    Keywords: cultural transmission.; education; homophily; Social Networks

    JEL: D85 I21

URL: http://d.repec.org/n?u=RePEc:cpr:ceprdp:11419&r=soc

 2. Does Experience Affect Fairness and Reciprocity in Lab Experiments?

    Tiziana Medda (University of Cagliari)

    Vittorio Pelligra (University of Cagliari)

    Tommaso Reggiani (LUMSA University)

 One of the most common criticisms about the external validity of lab  experiments in economics concerns the representativeness of participants  usually considered in these studies. The ever-increasing number of  experiments and the prevalent location of research centers in university  campuses produced a peculiar category of subjects: Students with high level  of laboratory experience built through repeated participations in  experimental sessions. We investigate whether the experience accumulated in  this way biases subjects’ behaviour in a set of simple games widely used to  study social preferences (Dictator Game, Ultimatum Game, Trust Game, and  Prisoner’s Dilemma Game). Our main finding shows that subjects with a high  level of experience in lab experiments do not behave in a significantly  different way from novices.

    Keywords: Experimental Methodology, External Validity, Experience, Lab Experiment

    JEL: D03 D83 C91 C92

URL: http://d.repec.org/n?u=RePEc:lsa:wpaper:wpc09&r=soc

 3. Migrant Networks and Trade: The Vietnamese Boat People as a Natural Experiment

    Parsons, Christopher (University of Western Australia)

    Vézina, Pierre-Louis (King's College London)  We provide evidence for the causal pro-trade effect of migrants and in doing  so establish an important link between migrant networks and long-run economic  development. To this end, we exploit a unique event in human history, i.e.

 the exodus of the Vietnamese Boat People to the US. This episode represents  an ideal natural experiment as the large immigration shock, the first wave of  which comprised refugees exogenously allocated across the US, occurred over a  twenty-year period during which time the US imposed a complete trade embargo  on Vietnam. Following the lifting of trade restrictions in 1994, US exports  to Vietnam grew most in US States with larger Vietnamese populations,  themselves the result of larger refugee inflows 20 years earlier.

    Keywords: migrant networks, US exports, natural experiment

    JEL: F14 F22

URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp10112&r=soc

 4. Gender-Oriented Languages and Female Labour Force Participation: Evidence  from Sub-Saharan Africa

    Michelle Rao

 Using the data from the Demographic and Health Surveys, this paper estimates  the relationship between language and labour force participation of women in  Sub-Saharan Africa. The results suggest that women who speak languages with  stronger distinctions between masculine and feminine are less likely to  participate in the labour force. This relationship holds both across and  within countries, even after controlling for individual characteristics,  religion and proxies for gender social norms related to ones ethnicity, such  as historical use of the plough. The results suggest that language has a  direct effect on preferences regarding labour market decisions, above and  beyond gender norms arising from ethnicity and religion. These findings  contribute to the growing literature on the relationship between  socio-psychological factors and gender differences in economic outcomes.

    Keywords: Language; Identity; Culture; Gender social norms; Female labour  force participation ; Sapir-Whorf hypothesis

    JEL: D03 J16 N37 O55

URL: http://d.repec.org/n?u=RePEc:csa:wpaper:2016-12&r=soc

 5. Innovation, Pricing and Targeting in Networks

    Fabrizio Panebianco

    Thierry Verdier

    Yves Zenou

 Consider a network of firms where a firm T is given the opportunity to  innovate a product (first-generation innovation). If successful, this firm  can temporarily sell this innovation to her direct neighbors because this  will give her access to a larger market. However, if her direct neighbors  innovate themselves on top of firm T's innovation (second-generation  innovations), then firm T loses the right to sell her initial innovation to  the remaining firms in the market. We analyze this game where each firm (T  and her direct neighbors) has to decide at which price they want to sell  their innovation. We show that the optimal price policy of each firm depends  on the level of property rights protection, the position of firm T in the  network, her degree and the size of the market. We then analyze the welfare  implications of our model where the planner that maximizes total welfare has  to decide which firm to target. We show that it depends on the level of  property rights protection and on the network structure in a non-trivial way.

 JEL classification: D85, L1, Z13. Keywords: Networks, diffusion centrality,  targets, innovation.

URL: http://d.repec.org/n?u=RePEc:igi:igierp:579&r=soc

 6. Where to Look for the Morals in Markets?

    Sutter, Matthias (University of Cologne)

    Huber, Jürgen (University of Innsbruck)

    Kirchler, Michael (University of Innsbruck)

    Stefan, Matthias (University of Innsbruck)  Markets are ubiquitous in our daily life and, despite many imperfections,  they are a great source of human welfare. Nevertheless, there is a heated  recent debate on whether markets erode social responsibility and moral  behavior. In fact, competitive pressure on markets may create strong  incentives for unethical practices (like using child labor) to increase  competitiveness. While markets have been considered as detrimental for moral  behavior, it has turned out a challenging task to identify where moral  behavior is reflected in a market. Recent work has suggested that falling  prices in markets with externalities are an indicator of declining morals.

 Here we examine the relation between trading volume, prices and moral  behavior by presenting an experimental study where we let buyers and sellers  interact on a double auction market. In one set of treatments, concluding a  trade has no externality; in the other set, there is a negative externality  by voiding donations for a potentially life-saving measles vaccine to UNICEF.

 We find that moral behavior reveals itself in lower trading volume in markets  with an externality, but that market prices are hardly different between  markets with or without an externality. We also vary the number of buyers and  sellers and show that prices depend mainly on the relative number of buyers  and sellers, but not on the existence of an externality. Hence, the market  forces of supply and demand work equally well in determining prices whether  or not trading has an externality.

    Keywords: morals, markets, competition, experiment

    JEL: C92 D03 D62

URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp10105&r=soc

 7. Does Empathy Beget Guile? Experimental Evidence

    Chen, Daniel L.

 Some theories about the positive impact of markets on morality suggest that  competition increases empathy, not between competitors, but between them and  third parties. However, empathy may be a necessary evolutionary antecedent to  guile, which is when someone knows what the other person wants and  intentionally deceives him or her, and deception may have evolved as a means  of exploiting empathy. This paper examines how individuals primed for empathy  behave towards third parties in a simple economic game of deception. It  reports the results of a data entry experiment in an online labor market.

 Individuals enter data randomized to be a prime for empathy, for guile, or a  control. Empathy is then measured using a Reading the Mind in the Eyes Test  and guile is measured using a simple economic game. Individuals primed for  empathy become less deceptive towards third parties. Individuals primed for  guile become less likely to perceive that deceiving an individual is unfair  in a vignette. These results are robust to a variety of controls and to  restricting to workers who entered the prime accurately. These findings are  inconsistent with the hypothesis that empathy causes guile and suggests that  empathy may cause those who are making judgements to become less deceptive.

    Keywords: Normative Commitments, Other-Regarding Preferences, Empathy, Deception, Guile

    JEL: D03 D64 K00

URL: http://d.repec.org/n?u=RePEc:tse:iastwp:30643&r=soc

 8. Social Ties of University Students: Evidence from a Longitudinal Survey in Russia

    Ekaterina V. Krekhovets (National Research University Higher School of Economics)

    Liudmila A. Leonova (National Research University Higher School of Economics)

 Student friendship networks can be considered as social capital, which is  known to be a very useful resource during university and after it. Several  empirical studies have examined static models of student behaviour in social  networks. In this study we analyse the dynamic changes of student social  connections. We use original longitude data of student social ties from one  Russian university. Data was collected within the framework of a research  project of the International Research Laboratory for Institutional Analysis  of Economic Reforms. To investigate factors influencing the evolution of  social ties during university probit regressions were tested. We found that  students with similar characteristics such as gender and academic achievement  are more likely to become friends and continue to be friends. Both studying  in the same group and living in a dormitory increase the likelihood of being  friends. We also found a transitivity effect. We observe a positive effect of  having common friend on friendship ties. We also notice a positive link  between reciprocity and friendship stability.

    Keywords: social networks, friendship, higher education

    JEL: D85 I21 I23

URL: http://d.repec.org/n?u=RePEc:hig:wpaper:33edu2016&r=soc

 9. In God We Learn? Religions' Universal Messages, Context-Specific Effects, and Minority Status

    Méon, Pierre-Guillaume (Free University of Brussels)

    Tojerow, Ilan (Free University of Brussels)  We study the relationship between major religious denominations and  individuals' levels of education, using the World Values Survey. In a first  step, running country-by-country regressions, we report first-time evidence  that no single denomination has a universal effect on education. Each  denomination has a positive and statistically significant effect in some  countries, a negative and statistically significant effect in others, and a  statistically insignificant effect elsewhere. In a second step, we relate the  sign of the impact of a denomination in a country to whether the denomination  is a minority in that country. We find that denominations that are a minority  in a country are more likely to be associated with a higher level of  education, and less likely to be associated with a lower level of education  in that country. In both steps, the findings are independent from the  specification of the regressions used in the first stage to determine the  sign of the impact of denominations on educational outcomes. The finding of  the second step is moreover robust to defining minority denominations using  various thresholds. It is robust to controlling for whether the denomination  is a state religion, for the country's level of democracy, per capita GDP, or  level of education, to introducing denomination- and country- fixed effects,  and to controlling for the identity of the largest other denomination in the  country.

    Keywords: religion, education, minority

    JEL: I2 O5 Z1

URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp10077&r=soc

10. Cooperation among behaviorally heterogeneous players in social dilemma with stay of leave decisions

    Xiaochuan Huang (DT Capital Management Co., Ltd.)

    Takehito Masuda (Institute of Economic Research, Kyoto University)

    Yoshitaka Okano (School of Economics and Management, Kochi University of Technology)

    Tatsuyoshi Saijo (School of Economics and Management, Kochi University of Technology)

 We experimentally test a two-stage mechanism called the stay-leave mechanism  to achieve cooperation in n-plyer prisoner's dilemma situations. Under this  mechanism, each cooperator has the chance to revise his choice when players' choices are not unanimous. We say a player is selfish if he eliminates  dominated choices in each stage. If all participants of the stay-leave  mechanism are selfish, for any value of public good benefit that arises, the  unique equilibrium is unanimous cooperation. The average cooperation rate in  the stay-leave mechanism experiment averaged 86.6% across 15 periods, with an  upward trend, increasing to 96.0% after period 5. By examining earlier period  data, we detected that selfish and conditionally cooperative subjects coexist  at a proportion of approximately 3:1. Finally, we extended our model to  incorporate a mixture of the observed two types and misbeliefs about others'  types. Paradoxically, unanimous cooperation is less likely to occur as the  number of conditionally cooperative players increase. The model also  partially explains the observed upward trend in the cooperation rate in the  stay-leave mechanism sessions.

    Keywords: social dilemma; experiment; conditional cooperator; behavioral heterogeneity

    JEL: C72 C72 D74 H41 P43

URL: http://d.repec.org/n?u=RePEc:kyo:wpaper:944&r=soc

11. Young Adults Living with Their Parents and the Influence of Peers

    Adamopoulou, Effrosyni (Efi) (Bank of Italy)

    Kaya, Ezgi (Cardiff University)

 This paper studies the impact of peer behavior on living arrangements of  young adults in the U.S. Using data from the National Longitudinal Study of  Adolescent Health (Add Health) we analyze the influence of high school  friends on the nest-leaving decision of young adults. We achieve  identification by exploiting the differences in the timing of leaving the  parental home among peers, the individual-specific nature of the peer groups  that are based on friendship nominations, and by including school (network)  and grade (cohort) fixed effects. Our results indicate that there are  statistically significant peer effects on the decision of young adults to  leave parental home. This is true even after we control for labor and housing  market conditions and for a comprehensive list of individual and  family-of-origin characteristics that are usually unobserved by the  econometrician. We discuss various mechanisms and we confirm the robustness  of our results through a placebo exercise. Our findings reconcile with the  increasing fraction of young adults living with their parents that is  persisting in the U.S. even after the end of the Great Recession.

    Keywords: peer effects, friends, living arrangements, leaving parental home

    JEL: D10 J12 J60 Z13

URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp10070&r=soc

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