HANDBOOK OF SOCIAL ECONOMICS
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1 HANDBOOK OF SOCIAL ECONOMICS VOLUME Edited by JESS BENHABIB ALBERTO BISIN MATTHEW O. JACKSON j & * <(.! *> f» rastitsi &isis«.'fwjiwm GLSEVIER Amsterdam Boston Heidelberg London New York Oxford Paris San Diego San Francisco Singapore Sydney Tokyo North-Holland is an imprint of Elsevier c
2 Contributors Introduction xv xvii Part I: Social Preferences 1. Nature and Nurture Effects On Children's Outcomes: What Have We Learned From Studies of Twins And Adoptees? 1 Bruce Sacerdote 1. Introduction and Overview 2 2. The Behavioral Genetics Model 5 3. Canonical Results from the Behavioral Genetics Literature 8 4. Critiques and Challenges to Interpretation of the Behavioral Genetics Results on IQ and Schooling Treatment Effects and Regression Coefficients Results from Economics on Adoptees Putting It All Together: What Does It Mean? 25 References Social Norms and Preferences 31 Andrew Postlewaite 1. Introduction The Social Determinants of Preferences Reduced Form Preferences: Social Concerns Why Not Take the Indirect Preferences as the Primitive? Examples Employing Instrumental Concern for Rank, Concluding Remarks 63 References Preferences for Status: Evidence and Economic Implications 69 Ori Heffetz and Robert H. Frank 1. Introduction., Features of Status Evidence, Some Economic Implications Conclusion i 88 References " 89
3 vi Contents-Volume 1A 4. Preferences for Redistribution 93 Alberto Alesina and Paola Giuliano 1. Introduction Preferences for Redistribution: Theory^ Empirical Evidence, Conclusions 127 References Theories of Statistical Discrimination and Affirmative Action: A Survey 133 Hanming Fang and Andrea Moro 1. Introduction " The Use of'group Averages as a Proxy for Relevant Variables: the Exogenous Differences Literature Discriminatory Outcomes as a Result of Coordination Failure Discriminatory Outcomes Due to Inter-Group Interactions Dynamic Models of Discrimination Affirmative Action Efficiency Implications of Statistical Discrimination Conclusion 195 References Social Construction of Preferences: Advertising 201 Jess Benhabib and Alberto Bisin 1. Introduction The Benchmark Economy The Equilibrium Effects of Advertising The Effects of Advertising in Empirical Work Conclusions 218 References The Evolutionary Foundations of Preferences 221 Arthur J. Robson and Larry Samuelson 1. Introduction Evolutionary Foundations What Sort of Preferences? Preferences over What? Concluding Remark Proofs 298 References 305
4 Contents-Volume 1A vii 8. Social Norms 311 Mary A. Burke and H. Peyton Young 1. Background Norms, Customs, and Conventions ' Characteristic Features of Norm Dynamics Sociallnteractions and Social Norms A Model of Norm Dynamics Contractual Norms in Agriculture Medical Treatment Norms Body Weight Norms Concluding Discussion 334 References The Economics of Cultural Transmission and Socialization 339 Alberto Bisin and Thierry Verdier 1. Introduction Theoretical Studies -~ Empirical Studies Conclusions 407 References Civic Capital as the Missing Link 417 Luigi Guiso, Paola Sapienza, and Luigi Zingales 1. Introduction ' Definitions of Social Capital 420 ^ 3. Accumulation and Depreciation of Civic Capital Measuring Civic Capital, The Origins of Civic Capital 459 l 6. The Economic Effects of Civic Capital Conclusions 476 References Does Culture Matter? 481 Raquel Fernandez 1. Introduction 482 2; Some Preliminaries The Epidemiological Approach The Epidemiological Literature in Economics Concluding Questions and Remarks 506
5 Contents-Volume 1A 6. Acknowledgement. 508 References, 508 Part II: Social Actions 12. An Overview of Social Networks and Economic Applications 511 Matthew O. Jackson 1. Introduction Social Networks and Networked Markets The Structure of Social Networks Network Formation Modeling the Impact of Networks Concluding Remarks 574 References Local Interactions Onur Ozgiir 1. Introduction Static Models Dynamic Models Concluding Remarks 638 References Diffusion, Strategic Interaction, and Social Structure i 645 Matthew O. Jackson and Leeat Yariv,1. Introduction Empirical Background: Social Networks and Diffusion Models of Diffusion and Strategic Interaction Absent Network Structure Models of Diffusion and Strategic Interaction in Network Settings Closing Notes 674 References Learning in Networks 679 Sanjeev Goyal 1. Introduction Nonstrategic Interaction Strategic Interaction Concluding Remarks Appendix References 724
6 Contents-Volume 1A 16. Formation of Networks and Coalitions 729 Francis Bloch and Bhaskar Dutta 1. Introduction, One-Stage Models of Coalition and Network Formation ~ Sequential Models of Coalition and Network Formation Farsightedness Group Formation in Real Time The Tension between Efficiency and Stability Conclusions and Open Problems 774 References Matching, Allocation, and Exchange of Discrete Resources 781 Tayfun Sonmez and M. Utku Unver 1. Introduction House Allocation and Exchange Models Kidney Exchange -. l 4. School Admissions Axiomatic Mechanisms and Market Design Concluding Remarks / 844 References Index-Volume 1A 11 Index-Volume IB 141
7 Contributors ix Part III: Peer and Neighborhood Effects 18. Identification of Social Interactions 853 Lawrence E. Blume, William A. Brock, Steven N. Durlauf, and Yannis M. loannides 1. Introduction Decision Making in Group Contexts Linear Models of Social Interaction ', Social Networks and Spatial Models of Social Interactions Discrete Choice Models of Social Interactions Experimental Approaches Suggestions for Future Directions, Conclusions "' 942 References Econometric Methods for the Analysis of Assignment Problems in the Presence of Complementarity and Social Spillovers 965 Bryan S. Graham 1. Introduction An Overview of Empirical Matching Models Identification and Estimation of one-to-one Matching Models When Match Output is Observed Identification and Estimation of one-to-one Matching Models When Match Output is Unobserved: Equilibrium Approaches Segregation in the Presence of Social Spillovers " Treatment Response with Spillovers Areas for Further Research 1046 References Peer Effects in Education: A Survey of the Theory and Evidence 1053 Dennis Epple and Richard E. Romano 1. Introduction Theory Econometric Issues Empirical Evidence: Peer Effects 1110
8 xii Contents-Volume IB 5. Concluding Remarks 1156 References ' The Importance of Segregation, Discrimination, Peer Dynamics, and Identity in Explaining Trends in the Racial Achievement Gap 1165 Roland G. Fryer, Jr. 1. Trends in the Racial Achievement Gap Segregation Information-Based Models of Discrimination Peer Dynamics ' Identity ~ Conclusion 1189 References Labor Markets and Referrals 1193 Giorgio Topa 1. Introduction The Theoretical Literature Direct Evidence on Usage of Informal Search Methods Labor Market Referrals and Neighborhood Effects Randomized and Natural Experiments Directions for Future Research References ' Labor and Credit Networks in Developing Economies 1223 Kaivan Munshi, : 1. Introduction Identification and Estimation of Network Effects ' Networks, Growth, and Efficiency Conclusion 1253 References Risk Sharing Between Households 1255 Marcel Fafchamps 1. Introduction Efficient Risk Sharing ' Forms of Risk Sharing The Motives for Risk Sharing Risk Sharing Groups and Networks 1270
9 Contents-Volume IB xiii 6. Conclusion 1275 References Neighborhood Effects And Housing 1281 Yannis M. loannides 1. Introduction Spatial Models of Location with Social Interactions Endogenous Neighborhood and Contextual Effects in Housing Markets Neighborhood Effects and the Geometry of the Canonical Urban Model Hierarchical Models of Location with Social Interactions Conclusion 1336 References 1337 Index-Volume 1B 11 Index-Volume 1A I23
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