In this issue we feature 16 current papers on the theme of social capital, chosen by Fabio Sabatini (Università degli Studi di Roma “La Sapienza”):

1. Social Networks, Promotions, and the Glass-Ceiling Effect Zaharieva, Anna; Neugart, Michael

2. Cultural Distance and Conflict-Related Sexual Violence Guarnieri, Eleonora; Tur-Prats, Ana

3. Comrades in the Family? Soviet Communism and Informal Family Insurance Costa-Font, Joan; Nicinska, Anna

4. Governance and Group Conflict Kölle, Felix

5. Generosity during Covid-19 the effect of social distancing and framing on donations in dictator games Lotti, Lorenzo

6. Trust and Reputation under Asymmetric Information Janas, Moritz; Oljemark, Emilia

7. Social networks, confirmation bias and shock elections Edoardo Gallo; Alastair Langtry

8. Equality of the Sexes and Gender Differences in Competition: Evidence from Three Traditional Societies Schwieren, Christiane; Klonner, Stefan; Pal, Sumantra

9. I spot, I adopt! Peer effects and visibility in solar photovoltaic system adoption of households. Rode, Johannes; Müller, Sven

10. Inference of a universal social scale and segregation measures using social connectivity kernels Hoffmann, Till; Jones, Nick S.

11. Trustworthiness in the Financial Industry Andrej Gill; Matthias Heinz; Heiner Schumacher; Matthias Sutter

12. Are people conditionally honest? The effects of stakes and information about others' behavior Necker, Sarah; Le Maux, Benoit; Masclet, David

13. Mothers’ Social Networks and Socioeconomic Gradients of Isolation Alison Andrew; Orazio Attanasio; Britta Augsburg; Jere Behrman; Monimalika Day; Pamela Jervis; Costas Meghir; Angus Phimister

14. Lying and Mistrust in the Continuous Deception Game Beck, Tobias

15. Insights into Fairness through Trust: Multi-scale Trust Quantification for Financial Deep Learning Alexander Wong; Andrew Hryniowski; Xiao Yu Wang

16. On the relevance of economic preferences, values, norms, and socio-demographics for electricity consumption Groh, Elke D.; Ziegler, Andreas

1. Social Networks, Promotions, and the Glass-Ceiling Effect Zaharieva, Anna; Neugart, Michael

Empirical studies show that women are under-represented in highly paid top management positions of firms (glass-ceiling effect) which could be a cause of the gender wage gap. In order to study women's career paths, we develop a search and matching model where job ladders consist of three hierarchical levels and workers can progress in the career by means of internal promotions and job-to-job mobility. Both, formal applications and referral hiring via endogenous social networks, can be used for external moves between firms. We show that when female workers are the minority in the occupation and social link formation is gender-biased (homophily) there are too few female contacts in the social networks of their male colleagues. This disadvantage implies that female workers are referred less often and, thereby, become under-represented in top level management positions of firms. Our results suggest that endogenously forming homophilous social networks when female workers are the minority can explain a substantial part of the empirically observable total wage gap stemming from the glass-ceiling effect. In addition, we demonstrate that the effects on an unequal gender-representation are amplified by stronger clustering of social networks, and gender-biased promotion times. Furthermore, deeper hierarchical firm structures amplify the network-driven gender inequality but mitigate inequality arising from direct discrimination in internal promotions. JEL: D21 D85 J31 J63 J71 Keywords: glass-ceiling effect,networks,discrimination,theory of the firm,promotions,search-and-matching labor market Date: 2020 URL: http://d.repec.org/n?u=RePEc:zbw:vfsc20:224534&r=soc

2. Cultural Distance and Conflict-Related Sexual Violence Guarnieri, Eleonora; Tur-Prats, Ana

This paper examines the role of ethnic-based gender norms in explaining the occurrence and intensity of sexual violence in conflict. We generate a novel dyadic dataset that contains information on the ethnic identity of the actors involved in 33 ethnic civil conflicts in Africa between 1989 and 2009 and their use of sexual violence. After exploiting ancestral economic, family, and societal arrangements, we construct and validate an ethnic-based gender inequality index. We control for a large set of fixed effects and find empirical support for two interrelated hypotheses. First, gender-unequal armed actors are more likely to be perpetrators of sexual violence. Second, we consider the perpetrator's gender norms relative to the victim's. Applying a gravity approach, we find that sexual violence is driven by a specific clash of conceptions on the appropriate role of men and women in society: sexual violence increases when the perpetrator is more gender-unequal than the victim. We show that (i) these patterns are specific to sexual violence and do not explain general violence within a conflict; (ii) differences in other dimensions of culture unrelated to gender do not explain conflict-related sexual violence. JEL: D74 J16 O55 Z1 Keywords: Ethnic civil conflict,sexual violence,culture,gender norms Date: 2020 URL: http://d.repec.org/n?u=RePEc:zbw:vfsc20:224571&r=soc

3. Comrades in the Family? Soviet Communism and Informal Family Insurance Costa-Font, Joan (London School of Economics); Nicinska, Anna (Warsaw University)

We study the effect of exposure to communism (EC), a political-economic regime based on collectivist planning, on preferences for family supports, which we refer to as 'informal family insurance'. We exploit both cross-country and cohort variation in EC in a large sample of Central and Eastern European countries (CEEC). Against the backdrop that 'communism gives rise to the abolition of the family', we find robust evidence that EC strengthens the preference for family insurance which coexists with a stronger preference for social insurance. We find a six per cent increase in preferences for care to older parents and a four per cent increase in preferences for support to pre-school children and financial support to adult children. These effects are explained by the erosion of both generalized trust and the lower confidence in public institutions, suggesting that (raising uncertainty and adversity during) communism increased the demand for all types of available insurance. JEL: Z1 P3 Keywords: informal family insurance, family networks, social insurance, interpersonal trust, confidence in institutions, Soviet communism, Eastern Europe Date: 2020–11 URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp13850&r=soc

4. Governance and Group Conflict Kölle, Felix

Many situations in the social and economic life are characterized by rivalry and conflict between two or more competing groups. Warfare, socio-political conflicts, political elections, lobbying, and R&D competitions are all examples of inter-group conflicts in which groups spend scarce and costly resources to gain an advantage over other groups. Here, we report on an experiment that investigates the impact of political institutions within groups on the development of conflict between groups. We find that relative to the case in which group members can decide individually on their level of conflict engagement, conflict significantly intensifies when investments are determined democratically by voting or when a single group member (the dictator) can decide on behalf of the group. These results hold for both symmetric and asymmetric contests, as well as for situations in which institutions are adopted exogenously or endogenously. Our findings thus suggest that giving people the possibility to vote is not the main reason for why democracies seem to engage in less wars than autocracies. Nevertheless, when giving participants the possibility to choose which institution to adopt, we find that democracy is the by far most popular one as it combines the desirable features of autonomy and equality. JEL: D72 C72 C92 Keywords: Conflict,competition,institutions,demo cracy,groups,experiment Date: 2020 URL: http://d.repec.org/n?u=RePEc:zbw:vfsc20:224515&r=soc

5. Generosity during Covid-19 the effect of social distancing and framing on donations in dictator games Lotti, Lorenzo

This paper investigates the impact of prolonged social distancing on generosity by analyzing the responses of 1255 US citizens to dictator games spread out over eight weeks of the early stages of the COVID-19 pandemic. Despite the isolation and the negative effects on employment and household finances, individuals became more generous over this time period. There is significant heterogeneity in the effect of additional regressors,such as perceived contagion risk, on the likelihood and amount donated to strangers,family members, or the government. At the same time, significant effects of the position of games with respect to the others highlight the significant role of framing on generous behaviours. JEL: C71 D63 D64 D71 D91 I14 Keywords: Generosity, Dictator Game, Social Preferences, Framing, Altruism, Covid-19 Date: 2020–10–28 URL: http://d.repec.org/n?u=RePEc:pra:mprapa:103826&r=soc

6. Trust and Reputation under Asymmetric Information Janas, Moritz; Oljemark, Emilia

We study the role of information about the multiplier in a finitely repeated investment game. A high multiplier increases the reputational incentives of a trustee, leading to more repayments. Our perfect Bayesian equilibrium analysis shows that if the trustee is privately informed about the multiplier, both the expected frequency of investments and repayments as well as the expected payoffs of both players are higher compared to a situation where the multiplier is public knowledge. We test this result in a laboratory experiment. The data cannot confirm the predicted welfare dominance of private information about the multiplier. We discuss potential reasons for the deviation between theory and experimental data. JEL: C73 C92 D82 D83 M13 Keywords: reputation,trust,incomplete information,experiment Date: 2020 URL: http://d.repec.org/n?u=RePEc:zbw:vfsc20:224518&r=soc

7. Social networks, confirmation bias and shock elections Edoardo Gallo; Alastair Langtry

In recent years online social networks have become increasingly prominent in political campaigns and, concurrently, several countries have experienced shock election outcomes. This paper proposes a model that links these two phenomena. In our set-up, the process of learning from others on a network is influenced by confirmation bias, i.e. the tendency to ignore contrary evidence and interpret it as consistent with one's own belief. When agents pay enough attention to themselves, confirmation bias leads to slower learning in any symmetric network, and it increases polarization in society. We identify a subset of agents that become more/less influential with confirmation bias. The socially optimal network structure depends critically on the information available to the social planner. When she cannot observe agents' beliefs, the optimal network is symmetric, vertex-transitive and has no self-loops. We explore the implications of these results for electoral outcomes and media markets. Confirmation bias increases the likelihood of shock elections, and it pushes fringe media to take a more extreme ideology. Date: 2020–11 URL: http://d.repec.org/n?u=RePEc:arx:papers:2011.00520&r=soc

8. Equality of the Sexes and Gender Differences in Competition: Evidence from Three Traditional Societies Schwieren, Christiane; Klonner, Stefan; Pal, Sumantra

Can gender-balanced social norms mitigate the gender differences in competitiveness that are observed in traditional patriarchic as well as in modern societies? We experimentally assess men's and women's preferences to compete in a traditional society where women and men have similar rights and entitlements alongside a patriarchic and a matrilineal society which have previously been studied. We find that, unlike in the patriarchic society, there is no significant gender difference in the inclination to compete in the gender-balanced society. We also find that women's decisions in our experiment are optimal more often than men's in the gender-balanced society - opposite to the pattern encountered in the patriarchic society. Our results highlight the importance of culture and socialization for gender differences in competitiveness and suggest that the large gender-differences in competitiveness documented for modern societies are a long-term consequence of a patriarchic heritage. JEL: C93 D81 J15 J16 Keywords: Competition,Gender difference,Social norms,Traditional societies Date: 2020 URL: http://d.repec.org/n?u=RePEc:zbw:vfsc20:224523&r=soc

9. I spot, I adopt! Peer effects and visibility in solar photovoltaic system adoption of households. Rode, Johannes; Müller, Sven

We study variation of peer effects in rooftop photovoltaic adoption by households. Our investigation employs geocoded data on all potential adopters and on all grid-connected photovoltaic systems set up in Germany through 2010. We construct an individual measure of peer effects for each potential adopter. For identification, we exploit exogenous variation in two dimensions of photovoltaic system roof appropriateness of neighbors: their inclination and their orientation. Using discrete choice models with panel data, we find evidence for causal peer effects. However, the impact of one previously installed PV system on current adoption decreases over time. We also show that visible PV systems cause an increase in the odds of installing which is up to three times higher in comparison to all PV systems. At rural locations visibility may be less important, which indicates that word-of-mouth communication plays a stronger role. JEL: O33 C35 Q55 R10 Keywords: Causal peer effects,installed base,discrete choice,technology adoption and diffusion,solar photovoltaic panels,visibility Date: 2020 URL: http://d.repec.org/n?u=RePEc:zbw:vfsc20:224644&r=soc

10. Inference of a universal social scale and segregation measures using social connectivity kernels Hoffmann, Till; Jones, Nick S.

How people connect with one another is a fundamental question in the social sciences, and the resulting social networks can have a profound impact on our daily lives. Blau offered a powerful explanation: people connect with one another based on their positions in a social space. Yet a principled measure of social distance, allowing comparison within and between societies, remains elusive. We use the connectivity kernel of conditionally independent edge models to develop a family of segregation statistics with desirable properties: they offer an intuitive and universal characteristic scale on social space (facilitating comparison across datasets and societies), are applicable to multivariate and mixed node attributes, and capture segregation at the level of individuals, pairs of individuals and society as a whole. We show that the segregation statistics can induce a metric on Blau space (a space spanned by the attributes of the members of society) and provide maps of two societies. Under a Bayesian paradigm, we infer the parameters of the connectivity kernel from 11 ego-network datasets collected in four surveys in the UK and USA. The importance of different dimensions of Blau space is similar across time and location, suggesting a macroscopically stable social fabric. Physical separation and age differences have the most significant impact on segregation within friendship networks with implications for intergenerational mixing and isolation in later stages of life. JEL: C1 Z13 Keywords: social networks; segregation; ego networks; inference Date: 2020–10–28 URL: http://d.repec.org/n?u=RePEc:pra:mprapa:103852&r=soc

11. Trustworthiness in the Financial Industry Andrej Gill; Matthias Heinz; Heiner Schumacher; Matthias Sutter (Max Planck Institute for Research on Collective Goods, Bonn)

The financial industry has been struggling with widespread misconduct and public mistrust. Here we argue that the lack of trust into the financial industry may stem from the selection of subjects with little, if any, trustworthiness into the financial industry. We identify the social preferences of business and economics students, and follow up on their first job placements. We find that during college, students who want to start their career in the financial industry are substantially less trustworthy. Most importantly, actual job placements several years later confirm this association. The job market in the financial industry does not screen out less trustworthy subjects. If anything the opposite seems to be the case: Even among students who are highly motivated to work in finance after graduation, those who actually start their career in finance are significantly less trustworthy than those who work elsewhere. JEL: C91 G20 M51 Keywords: Trustworthiness, Financial Industry, Selection, Social Preferences, Experiment Date: 2020–08 URL: http://d.repec.org/n?u=RePEc:mpg:wpaper:2020_19&r=soc

12. Are people conditionally honest? The effects of stakes and information about others' behavior Necker, Sarah; Le Maux, Benoit; Masclet, David

We study theoretically and empirically how monetary incentives and information about others' behavior affects dishonesty. We ran a laboratory experiment with 560 participants inspired by the "observed game" developed by Kajackaite and Gneezy (2017). We find that the extensive (the fraction of liars) and intensive (the size of the lie) margin of dishonesty decrease when stakes are very high. On average, information about others slightly increases the fraction of liars but has no effect on the size of the lie. Distinguishing subjects by their belief on others' behavior, we find that information decreases the fraction of liars among over-estimators and increases the fraction among under-estimators. This pattern is the same across payoff levels. JEL: C91 D03 D78 Keywords: Laboratory experiment,theory,cheating,incentives,information,moral costs,lying costs Date: 2020 URL: http://d.repec.org/n?u=RePEc:zbw:vfsc20:224578&r=soc

13. Mothers’ Social Networks and Socioeconomic Gradients of Isolation Alison Andrew; Orazio Attanasio; Britta Augsburg; Jere Behrman; Monimalika Day; Pamela Jervis; Costas Meghir; Angus Phimister

Social connections are fundamental to human wellbeing. This paper examines the social networks of young married women in rural Odisha, India. This is a group for whom highly-gendered norms around marriage, mobility and work are likely to shape opportunities to form and maintain meaningful ties with other women. We track the social networks of 2,170 mothers over four years, and find a high degree of isolation. Wealthier women and women from more-advantaged castes and tribes have smaller social networks than their less-advantaged peers. These gradients are primarily driven by the fact that more-advantaged women are less likely to know other women within the same socioeconomic group than are less-advantaged women. There exists strong homophily by socioeconomic status (SES) that is symmetric across socioeconomic groups. Mediation analysis shows that SES differences in social isolation are strongly associated with ownership of toilets and labor force participation. Further research should investigate the formation and role of female networks. JEL: D13 D71 O1 O35 Date: 2020–11 URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:28049&r=soc

14. Lying and Mistrust in the Continuous Deception Game Beck, Tobias

I present a novel experimental design to measure lying and mistrust as continuous variables on an individual level. My experiment is a sender-receiver game framed as an investment game. It features two players: firstly, an advisor with complete information (i.e., the sender) who is incentivized to lie about the true value of an optimal investment and, secondly, an investor with incomplete information (i.e., the receiver) who is incentivized to invest optimally and therefore must rely on the alleged optimum reported by the advisor. Due to its continuous message space, this experiment allows observing more differentiated behavior and therefore enables testing of more sophisticated theoretical predictions. I find that the senders lie by overstating the true value of the optimum to an average extent of about 148%, while the receivers suspect them to do so by only 56%. Moreover, my results indicate that the senders make strategic considerations about their potential to manipulate others when deciding about the sizes of their lies. However, I find that the size of the lie and the size of mistrust do not only matter from a strategic perspective but also have an impact on how people perceive their own behavior. Consistent with previous studies, my findings support the conjecture that lying costs increase with the size of the lie. Beyond that, I provide evidence for some endogenous preference for trust. Both players’ behaviors and beliefs are consistent over time. In addition, my classification of both players’ strategies is consistent with their self-assessment of their behavior within the experiment. JEL: C91 D01 D82 Keywords: Size of the lie,Size of mistrust,Honesty,Deception Game,Investments,Asymmetric information,Experimental design Date: 2020 URL: http://d.repec.org/n?u=RePEc:zbw:vfsc20:224530&r=soc

15. Insights into Fairness through Trust: Multi-scale Trust Quantification for Financial Deep Learning Alexander Wong; Andrew Hryniowski; Xiao Yu Wang

The success of deep learning in recent years have led to a significant increase in interest and prevalence for its adoption to tackle financial services tasks. One particular question that often arises as a barrier to adopting deep learning for financial services is whether the developed financial deep learning models are fair in their predictions, particularly in light of strong governance and regulatory compliance requirements in the financial services industry. A fundamental aspect of fairness that has not been explored in financial deep learning is the concept of trust, whose variations may point to an egocentric view of fairness and thus provide insights into the fairness of models. In this study we explore the feasibility and utility of a multi-scale trust quantification strategy to gain insights into the fairness of a financial deep learning model, particularly under different scenarios at different scales. More specifically, we conduct multi-scale trust quantification on a deep neural network for the purpose of credit card default prediction to study: 1) the overall trustworthiness of the model 2) the trust level under all possible prediction-truth relationships, 3) the trust level across the spectrum of possible predictions, 4) the trust level across different demographic groups (e.g., age, gender, and education), and 5) distribution of overall trust for an individual prediction scenario. The insights for this proof-of-concept study demonstrate that such a multi-scale trust quantification strategy may be helpful for data scientists and regulators in financial services as part of the verification and certification of financial deep learning solutions to gain insights into fairness and trust of these solutions. Date: 2020–11 URL: http://d.repec.org/n?u=RePEc:arx:papers:2011.01961&r=soc

16. On the relevance of economic preferences, values, norms, and socio-demographics for electricity consumption Groh, Elke D.; Ziegler, Andreas

As long as electricity is generated from fossil fuels, the reduction of its consumption is an important direction for climate protection and related policy measures. Based on data of more than 3700 respondents in Germany, we thus empirically examine the relevance of a large set of well-known determinants of electricity consumption such as household and dwelling char-acteristics, but also of individual values and norms. Since behavioral economics highlights the importance of economic preferences in such public good contexts, we additionally consider risk and time preferences, trust, altruism, and reciprocity in our econometric analysis. With respect to the latter group of factors, however, only time preferences have a strong significant effect on electricity consumption. Furthermore, norms also play only a minor role. In contrast, our estimation results suggest a high relevance of dwelling characteristics and socio-demographics. Interestingly, it seems that a low electricity consumption is no important cli-mate protection activity of German inhabitants with strong environmental values, which is in contrast to the demand of such citizens for green electricity. JEL: Q41 Q54 Keywords: electricity consumption,economic preferences,individual values,social norms,econometric analysis Date: 2020 URL: http://d.repec.org/n?u=RePEc:zbw:vfsc20:224587&r=soc

This nep-soc issue is ©2020 by Fabio Sabatini. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.

General information on the NEP project can be found at http://nep.repec.org. For comments please write to the director of NEP, Marco Novarese at <director at nep.repec.org>. Put “NEP” in the subject, otherwise your mail may be rejected.

NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.