NEP: New Economics Papers - Social Norms and Social Capital - Digest, Vol 136, Issue 4

In this issue we feature 6 current papers on the theme of social capital, chosen by Fabio Sabatini (Università degli Studi di Roma “La Sapienza”):

1. Police violence reduces civilian cooperation and engagement with law enforcement Desmond Ang; Panka Bencsik; Jesse Bruhn; Ellora Derenoncourt

2. Trust, the Pandemic, and Public Policies James Alm

3. The Rise of a Network: Spillover of Political Patronage and Cronyism to the Private Sector Terry Moon; David Schoenherr

4. Norms, gender, and payment method affect extraction behavior in a framed field experiment on community forestry in India Zhang, Wei; Meinzen-Dick, Ruth Suseela; Valappanandi, Sanoop; Balakrishna, Raksha; Reddy, Hemalatha; Janssen, Marco A.; Thomas, Liya; Priyadarshini, Pratiti; Kandikuppa, Sandeep; Chaturvedi, Rahul; Ghate, Rucha

5. Internal and External Effects of Social Distancing in a Pandemic Maryam Farboodi; Gregor Jarosch; Robert Shimer

6. On the design of public debate in social networks Michel Grabisch; Antoine Mandel; Agnieszka Rusinowska

1. Police violence reduces civilian cooperation and engagement with law enforcement Desmond Ang (Harvard University); Panka Bencsik (University of Chicago); Jesse Bruhn (Brown University); Ellora Derenoncourt (Princeton University) How do high-profile acts of police brutality affect public trust and cooperation with law enforcement? To investigate this question, we develop a new measure of civilian crime reporting that isolates changes in community engagement with police from underlying changes in crime: the ratio of police-related 911 calls to gunshots detected by ShotSpotter technology. Examining detailed data from eight major American cities, we show a sharp drop in both the call-to-shot ratio and 911 call volume immediately after the police murder of George Floyd in May 2020. Notably, reporting rates decreased significantly in both non-white and white neighborhoods across the country. These effects persist for several months, and we find little evidence that they were reversed by the conviction of Floyd’s murderer. Together, the results illustrate how acts of police violence may destroy a key input into effective law enforcement and public safety: civilian engagement and reporting. JEL: K4 Keywords: police, crime reporting, use of force, race Date: 2021–09 URL: http://d.repec.org/n?u=RePEc:pri:econom:2021-16&r=&r=soc

2. Trust, the Pandemic, and Public Policies James Alm (Tulane University) What is the role of trust in designing public policies, especially during the current pandemic? In this paper I examine recent research that demonstrates the crucial effects of trust. This research suggests, I believe, two main conclusions. First, there is much emerging evidence that trust – and especially trust in government – is a major factor in shaping the effectiveness of public policies. In particular, when trust in government is weak, many government policies do not achieve their goals because people simply do not follow the government’s laws, regulations, and directives. Second, there is also much emerging evidence that trust is not fixed and given and immutable, mainly determined by a country’s history and culture and institutions, as was once believed. Instead, recent evidence indicates that trust can vary significantly, even over short periods of time. Indeed, there is growing research that trust in government can be affected in systematic ways by systematic policy interventions. These conclusions suggest that there are ways out of our current wilderness, even if these strategies will be neither easy nor quick. JEL: A13 H50 H70 Keywords: Trust; public policy; tax compliance; experiments; pandemic. Date: 2022–02 URL: http://d.repec.org/n?u=RePEc:tul:wpaper:2203&r=&r=soc

3. The Rise of a Network: Spillover of Political Patronage and Cronyism to the Private Sector Terry Moon (University of British Columbia); David Schoenherr (Princeton University) The misallocation of government resources to the politically connected is considered to impose substantial economic costs. We document that resource misallocation to the politically connected extends to resources allocated by private sector firms. Following the presidential election in 2007, private banks in Korea appoint executives from the new president’s alumni network in an effort to establish links to the new administration. In turn, private banks that appoint executives from the president’s alumni network allocate more credit to firms with links to the same network through their CEOs. Additionally, in-network firms pay lower interest rates and are protected from default through debt restructurings. Exploiting variation for the same firm across different lenders over time allows us to control for firm-time fixed effects, sharpening the identification of the results. We estimate that private banks incur aggregate losses equivalent to 4.5 basis points of GDP due to preferential treatment of in-network firms. JEL: D61 D72 G21 L14 P16 Keywords: allocative efficiency, banks, networks, patronage, rent-seeking Date: 2020–12 URL: http://d.repec.org/n?u=RePEc:pri:econom:2020-73&r=&r=soc

4. Norms, gender, and payment method affect extraction behavior in a framed field experiment on community forestry in India Zhang, Wei; Meinzen-Dick, Ruth Suseela; Valappanandi, Sanoop; Balakrishna, Raksha; Reddy, Hemalatha; Janssen, Marco A.; Thomas, Liya; Priyadarshini, Pratiti; Kandikuppa, Sandeep; Chaturvedi, Rahul; Ghate, Rucha This paper presents results from a framed field experiment in which participants make decisions about extraction of a common-pool resource, a community forest. The experiment was designed and piloted as both a research activity and an experiential learning intervention during 2017-2018 with 120 groups of resource users (split by gender) from 60 habitations in two Indian states, Andhra Pradesh and Rajasthan. We examine whether local beliefs and norms about community forest, gender of participants, within-experiment treatments (non-communication, communication, and optional election of institutional arrangements (rules)) and remuneration methods affect harvest behaviour and groups’ tendency to cooperate. Furthermore, we explore whether the experiment and subsequent community debriefing had learning effects. Results reveal a “weak†Nash Equilibrium in which participants harvested substantially less than the Nash prediction even in the absence of communication, a phenomenon stronger for male than female participants in both states. For male groups in both states, both communication and optional rule election are associated with lower group harvest per round, as compared to the reference non-communication game. For female groups in both states, however, communication itself did not significantly slow down resource depletion; but the introduction of optional rule election did reduce harvest amounts. For both men and women in Andhra Pradesh and men in Rajasthan, incentivized payments to individual participants significantly lowered group harvest, relative to community flat payment, suggesting a possible “crowding-in†effect on pro-social norms. Despite the generally positive memory of the activity, reported actual changes are limited. This may be due to the lack of follow-up with the communities between the experiment and the revisit. The fact that many of the communities already have a good understanding of the importance of the relationships between (not) cutting trees and the ecosystem services from forests, with rules and strong internal norms against cutting that go beyond the felling of trees in the game, may have also meant that the game did not have as much to add. Findings have methodological and practical implications for designing behavioral intervention programs to improve common-pool resource governance. Keywords: INDIA; SOUTH ASIA; ASIA; gender; extraction; community forestry; collective ownership; field experimentation; forests; game; experiential learning; payment methods; common-pool resource; framed field experiments; Date: 2021 URL: http://d.repec.org/n?u=RePEc:fpr:ifprid:2091&r=&r=soc

5. Internal and External Effects of Social Distancing in a Pandemic Maryam Farboodi (MIT); Gregor Jarosch (Princeton University); Robert Shimer (University of Chicago) We develop a quantitative framework for exploring how individuals trade off the utility benefit of social activity against the internal and external health risks that come with social interactions during a pandemic. We calibrate the model to external targets and then compare its predictions with daily data on social activity, fatalities, and the estimated effective reproduction number R(t) from the COVID-19 pandemic in March-June 2020. While the laissez- faire equilibrium is consistent with much of the decline in social activity that we observed in US data, optimal policy further imposes immediate and highly persistent social distancing. Notably, neither equilibrium nor optimal social distancing is extremely restrictive, in the sense that the effective reproduction number never falls far below 1. The expected cost of COVID-19 in the US is substantial, $12,700 in the laissez-faire equilibrium and $8,100 per person under an optimal policy. Optimal policy generates this large welfare gain by shifting the composition of costs from fatalities to persistent social distancing. JEL: D11 D81 I12 I18 Keywords: COVID-19, social activity, reproduction number, economic epidemiology, optimal control, externalities Date: 2021–03 URL: http://d.repec.org/n?u=RePEc:pri:econom:2021-78&r=&r=soc

6. On the design of public debate in social networks Michel Grabisch (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, UP1 - Université Paris 1 Panthéon-Sorbonne, PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Antoine Mandel (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, UP1 - Université Paris 1 Panthéon-Sorbonne, PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Agnieszka Rusinowska (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement) We propose a model of the joint evolution of opinions and social relationships in a setting where social influence decays over time. The dynamics are based on bounded confidence: social connections between individuals with distant opinions are severed while new connections are formed between individuals with similar opinions. Our model naturally gives raise to strong diversity, i.e., the persistence of heterogeneous opinions in connected societies, a phenomenon that most existing models fail to capture. the intensity of social interactions is the key parameter that governs the dynamics. First, it determines the asymptotic distributionn of opinions. In particular, increasing the intensity of social interactions brings society closer to consensus. Second, it determines the risk of polariztion, which is shown to increase with the intensity of social interactions. Our results allow to frame the problem of the design of public debates in a formal setting. We hence characterize the optimal strategy for a social planner who controls the intensity of the public debate and thus faces a trade-off between the pursuit of social consensus and the risk of polarization. We also consider applications to political campaigning and show that both minority and majority candidates can have incentives to lead society towards polarization. Keywords: opinion dynamics,network formation,network fragility,polarization,institution design,political campaign Date: 2022–01 URL: http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-03531788&r=&r=soc

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