Narrow Results

In this paper, we attempt to shed light on whether Japanese households are rational or if their behavior is influenced by culture and social norms by examining their saving and bequest behavior. To summarize our main findings, we find that Japan’s household saving rate showed great volatility, was often low and even negative and was high only during the 25-year period from around 1960 until the mid-1980s (if we exclude the war years) and that we can explain the high level of, and trends over time in, Japan’s household saving rate via various socioeconomic and policy variables. This seems to suggest that the Japanese are not a saving-loving people and that their saving behavior is not governed by culture and social norms. Moreover, the bequest behavior of the Japanese suggests that they are less altruistic toward their children and less reliant on their children than other peoples, suggesting that the alleged social norm of strong family ties in Japan is largely a myth, and that the Japanese do not appear to be appreciably more concerned about the continuation of the family line or the family business than other peoples, suggesting that the influence of the “ie” (family) system is apparently not so pervasive either. However, we argue that these findings do not necessarily mean that culture and social norms do not matter.

The COVID-19 pandemic brought the need to quickly deploy non-pharmaceutical measures like facemasks to reduce transmission rates into sharp focus. Factors influencing this behavior are examined through the classic attitude–behavior lens of Fishbein and Ajzen [Belief, Attitude, Intention, and Behavior: An Introduction to Theory and Research. Reading, MA: Addison-Wesley] cast in the language of property rights and social norms. Behavior is operationalized as wearing a facemask (or not) and attitude in terms of supporting a mandatory mask mandate. This yields targetable segments of the population as they are referred to in a marketing context: wearing/supporting, wearing/not supporting, not wearing/supporting, not wearing/not supporting [Kim, D, RT Carson, D Whittington and WM Hanemann (2022). Support for regulation versus compliance: Face masks during COVID-19. Public Health in Practice, 5, 100324]. Membership in each segment is predicted using a generalized structural equation modelling (GSEM) approach focused on three broad factors. The first includes political and demographic variables, which represent exogenous taste parameters. The second is a set of knowledge variables characterizing the COVID-19 information a person possesses. These are potentially influenceable by health officials. The third relates to risk cast in the form of knowing someone who had tested positive for COVID-19, been hospitalized or died from it. The GSEM results paint a rich picture of how our factor sets interact with the four targetable segments of the population in a critical situation where high but not perfect compliance is needed.

In an artificial society where agents repeatedly interact with one another, effective coordination among agents is generally a challenge. This is especially true when the participating agents are self-interested, and that there is no central authority to coordinate, and direct communication or negotiation are not possible. Recently, the problem was studied in a paper by Hao and Leung, where a new repeated game mechanism for modeling multi-agent interactions as well as a new reinforcement learning based agent learning method were proposed. In particular, the game mechanism differs from traditional repeated games in that the agents are anonymous, and the agents interact with randomly chosen opponents during each iteration. Their learning mechanism allows agents to coordinate without negotiations. The initial results had been promising. However, extended simulation also reveals that the outcomes are not stable in the long run in some cases, as the high level of cooperation is eventually not sustainable. In this work, we revisit he problem and propose a new learning mechanism as follows. First, we propose an enhanced Q-learning-based framework that allows the agents to better capture both the individual and social utilities that they have learned through observations. Second, we propose a new concept of \social attitude" for determining the action of the agents throughout the game. Simulation results reveal that this approach can achieve higher social utility, including close-to-optimal results in some scenarios, and more importantly, the results are sustainable with social norms emerging.

This paper focuses on the role that social norms play in the selection of equilibrium points seen as social conventions under unforeseen contingencies — that is, their role in the emergence of regularities of behavior which are self-enforcing and effectively adhered to by bounded rational agents due to their self-policing incentives. Differently stated, given a set of game situations imperfectly described, we want to understand how general and abstract norms provide at least the starting point for a norm-based equilibrium selection reasoning procedure which in the end will be able to determine which equilibrium point, belonging to perfectly described games, will be played as the unique solution of each imperfectly described game. In order to solve such a problem we introduce a selection process based on the reformulation of default logic in terms of possibility theory.

This article introduces a model of rationality that combines procedural utility over actions with consequential utility over payoffs. It applies the model to the Prisoners' Dilemma and shows that empirically observed cooperative behaviors can be rationally explained by a procedural utility for cooperation. The model characterizes the situations in which cooperation emerges as a Nash equilibrium. When rational individuals are not solely concerned by the consequences of their behavior but also care for the process by which these consequences are obtained, there is no one single rational solution to a Prisoners' Dilemma. Rational behavior depends on the payoffs at stake and on the procedural utility of individuals. In this manner, this model of procedural utility reflects how ethical considerations, social norms or emotions can transform a game of consequences.

The question how social norms can emerge from microscopic interactions between individuals is a key problem in social sciences to explain collective behavior. In this paper, we propose an agent-based model to show that randomly distributed social behavior by way of local interaction converges to a state with a multimodal distribution of behavior. This can be interpreted as a coexistence of different social norms, a result that goes beyond previous investigations. The model is discrete in time and space, behavior is characterized in a continuous state space. The adaptation of social behavior by each agent is based on attractive and repulsive forces caused by friendly and adversary relations among agents. The model is analyzed both analytically and by means of spatio-temporal computer simulations. It provides conditions under which we find convergence towards a single norm, coexistence of two opposing norms, and coexistence of a multitude of norms. For the latter case, we also show the evolution of the spatio-temporal distribution of behavior.

It has often been noted that most of the major world religions espouse a version of the "golden rule." In this paper we consider the cultural evolution of such a doctrine, where the responsibility to act altruistically towards others applies universally, not just to other members of the same society. Using a game-theoretical model, we find that societies over a critical size benefit from adopting a mode of universal altruism. These "golden-rule societies" must justify violence against outsiders by formulating exceptions to this universal rule. For smaller groups, it is more efficient to adopt a rule that simply requires cooperation within the group. Data from the ethnographic record supports a correlation between group size and societal norms of universal cooperation. Our results provide an explanation for the prevalence of the golden rule among contemporary cultures. We find that universal altruism arises due to cultural selection for greater ingroup bias, and is a natural byproduct of the emergence of large-scale societies.

The objective of this paper is to explore the need for and possible benefits of social norms-based intellectual property systems in the context of the renaissance of decentralized production. Innovative engineering in addition to powerful information and communications technology enables a renaissance of decentralized production. A central form of such is co-engaging production. This renaissance can already be observed in small-scale 3D printing, microbreweries, small-scale food production in rooftop greenhouses, and small-scale electricity generation with solar panels installed by users of electricity. Individuals engaging in decentralized production typically have limited resources, which may hinder them from applying registration for industrial property rights. Therefore, social norms-based intellectual property can, in some cases, be more cost efficient in the case of decentralized production. In the case of cross-border groups, social norms-based intellectual property can evolve regardless of territorially restricted national legal-based intellectual property rights. The advantages of social norms may override their disadvantages when no great economic interests are involved and the production and the need of protection are short-term by nature. The decentralized characteristic of social norms-based intellectual property brings in new people as creators of creations for which intellectual property protections exist. This can enhance creativity by broadening the cognitive and cultural diversity of the creations. Social norms-based and legal norms-based intellectual property systems are not mutually exclusive and can exist side-by-side.

Synopsis

The research problem

Adding to the literature in auditing, this study examines whether there is an association between the religious beliefs of audit partners and audit quality in Taiwan.

Motivation

Previous studies have found that firms headquartered in areas with strong religious social norms are associated with higher audit quality. However, prior studies measured religiosity in terms of whether the audit practice offices were in more religious metropolitan statistical areas. No work had examined whether the religious beliefs of the individual auditors affect auditor decision making. In addition, prior studies using US data were mainly confined to one group who are, in the main, Christians. We examined this issue in Taiwan where the auditors come from three main religious groups: Christian, Buddhist, and Taoist. This setting provides another cultural environment for understanding the links between religiosity and financial reporting issues.

The test hypotheses

H1: Audit engagement partners with a religious belief are associated with higher audit quality.

H2: The positive association between auditors’ religion and audit quality is more pronounced for auditors with industry specialization than auditors without specialization.

Target population

Various stakeholders include investors, auditors, financial analysts, and users of financial reports.

Adopted methodology

Ordinary least squares (OLS) regression and logistics regression.

Analyses

We conducted the study in Taiwan where audit partners are required to sign audit reports. We obtained data on the religious beliefs of auditors by distributing a questionnaire to individual auditors in the Big 4 in Taiwan. We used four measures of audit quality: (a) discretionary accruals, (b) accrual estimation errors, (c) the probability of a client meeting an earnings benchmark, and (d) the propensity to issue modified audit opinions. We tested whether there is a positive association between auditors’ religious beliefs and audit quality.

Findings

Our study finds that firms with an audit partner who professes a religion are associated with higher audit quality. However, unlike evidence from the United States, we do not find that auditors in an area with strong religious social norms exhibit better audit quality than auditors in less religious areas when the audit partner’s religious belief is controlled in the analysis. The results suggest that auditor quality is more affected by auditor’s personal characteristics than the social norms. We also find that the positive association between auditors with industry specialization and audit quality is stronger when the auditor has religious beliefs. The results suggest that ethics and competence are complements to each other.

Labor market discrimination is very difficult to pinpoint, even more difficult to measure and almost impossible to “prove”. This paper reviews the literature and makes two main contributions: first, it builds a four-fold typology to think about discrimination — overt or covert; conscious or unconscious; legal or illegal and real or perceived. Second, it identifies screens and filters — devices through which discrimination plays out in the labor market. Unless more empirical studies identify the play of discrimination and exclusion, subordinate groups may well be told that discrimination is actually in their heads — that they are imagining it.

In this paper, I estimate the price elasticity of residential electricity demand using household-level panel data for Russia. The study takes advantage of the variation in tariffs across regions and over time, as well as the introduction of increasing block rate (IBR) schemes in a number of regions. I show that in those regions consumers appear to be aware of the block cut-offs, even though the latter are based on the prescribed social norms and are household and dwelling specific, to the point that there are up to a total of 31 different tier cut-offs. Based on these results, I estimate the price elasticity of electricity demand to be around −0.1. I also predict the associated changes in electricity consumption, CO₂ emissions, and revenues if similar IBR policies are implemented countrywide.

Social norms comparisons are tools that are being used more and more often by energy and water utilities all over the world in order to induce households to conserve resources. Such conservation programs are appealing to utilities since they are an easy-to-implement alternative to raising prices and commonly result in short-term reductions in energy and water use of about 2–5%. However, the welfare effects of social norms programs are rarely discussed and assessed, especially in the context of municipal water supply. The purpose of this paper is to identify the costs and benefits of social norms information treatments (SNITs) to all social groups and to illustrate a conceptual framework for conducting a benefit–cost analysis of social norms treatments in the municipal water sector. We provide plausible estimates for the costs and benefits of social norms treatments to different affected groups in the municipal water supply sector using current knowledge for both developing and industrialized countries in order to show how practitioners can conduct a benefit–cost analysis of an SNIT for a specific water utility. Our calculations show that the outcome of a benefit–cost analysis of an SNIT is highly location-specific and likely subject to substantial uncertainty. We also present a simple benefit–cost analysis of a price increase that would lead to an equivalent initial reduction in household water use. The latter is found to be more likely to result in net benefits to the society as a whole in low- and middle-income countries, but we show that, in this case, households would have to bear most of the costs.

Providing an empirical and conceptual context for the volume, this chapter discusses patterns and trends in women's social and economic participation in the region, draws together the themes explored in individual chapters, and offers policy recommendations and suggestions for future research. Middle East and North Africa (MENA) countries have made good progress in educating women, whose schooling attainments often outstrip those of men, and in reducing fertility rates, but most of MENA women remain out of the labor force, and those who do work outside the home face a wide range of difficulties associated with their gender. Having so few women working is costly for the countries in the region, limiting their economic size and growth prospects. From a policy perspective, it is important to understand why so few women work. Reasons include discriminatory practices in the workplace and difficulty in obtaining access to credit and productive assets; women's reservation wages and internalized gender roles in traditionally patriarchal societies; and discrimination by government policies against female market-based activities. The chapter seeks to understand the links between these causual factors within a coherent analytical framework that can handle both diversity and difference.

This chapter uses data from a commissioned nationwide sample survey of some 1,100 female-headed households, as well as from focus groups with female household heads. Women-headed households constitute about one-tenth of Jordan's households. By region of residence, religion, and household size they differ little from households in the country at large. But nearly half of them (48 percent) are living below the poverty line, compared with about 13 percent in the population at large. Their annual spending is less than one-third of the nationwide average. Very few of the women household heads work outside the home: 78 percent of them are not and have never been employed. Their education levels are low: about 54 percent are either illiterate or have only basic schooling, and about 27 percent have secondary education. The problems faced by women household heads include malnutrition (a problem in nearly one in five of these families); social stigma attached to themselves and their children; problems in rearing their sons, many of whom drop out of school and become socially withdrawn; and pressures from their own or their husband's family. Recommendations are made for policies and other measures to assist female-headed households.

In recent decades, the Middle East and North Africa region achieved substantial improvement in women's education, but without a commensurate increase in women's participation in the labor market. Using primary household survey data collected in 2008 in Amman, Cairo, and Sana'a, this chapter empirically investigates whether education acts as a vehicle for labor market participation among urban women. As a baseline, we investigate the determinants of female labor force participation by means of a single-equation probit model. Based on the results of the probit model, we analyze the role of social norms. Results confirm that education increases female labor supply. However, when levels of schooling are considered, only high levels of education (post-secondary/university/post-university education) show a positive and significant effect. The study also confirms the negative association between traditional attitudes and female labor supply. Thus, policies in the region that aim to raise female labor force participation need to focus more broadly than on investment in education, to take account of other economic and non-economic barriers to female labor supply. Further investment in education in itself may not achieve the full intended goal for women in the labor market.

Using data from a survey of 1,500 households in Dubai City, this chapter explores the impacts of social, cultural, and religious factors on female labor force participation (FLFP) and finds that marriage and conservative cultural norms constitute the primary cause of economic inactivity among women. Secondary and tertiary education show positive impacts on FLFP. The impact of children is not always significant. Being expatriate has a positive impact on FLFP. Marriage has a significant negative impact on female participation. The findings suggest that changing perceptions and actions coexist with many old cultural and social norms, but also that the growing tendency is to accept the public presence and labor market participation of women. The women survey respondents expressed more conservative views than men, and expressed more support than men for cultural norms that allow for male control and limit women's freedom to move and choose employment. The younger generation (aged 15–24) expressed more conservative views than older people, despite being better educated than previous generations.

This chapter explores the attractiveness of the Middle East and North Africa (MENA) relative to other regions for trade in services by European firms. Businesses no longer just search for low-cost labor but also seek to tap into the talent markets of emerging countries in knowledge-intensive core business functions. The availability of large talent pools that can be trained and retained is a key deciding factor in the choice of an offshore location, as is the size and the depth of the female labor force. The study finds that the MENA region has the necessary market and labor fundamentals to become a viable near-shoring destination for European firms and that it has a significant advantage associated with its female talent pool. Nonetheless, it also has highly significant disadvantages, due to impediments that women face in joining and staying in the labor market. Overall, the findings suggest that MENA may lose the competition to attract jobs in this growing global sector.

This chapter examines the impact of an important Iranian government policy — the construction of rural health clinics and promotion of family planning — on the fertility and education of rural women. The evidence shows that the direct effect of family planning on fertility was rather modest: at best we can attribute one-fifth of the decline in fertility to the presence of clinics in villages. But the government's push to win acceptance of family planning played a crucial role in helping women to overcome the traditional norms against women's participation in the fertility decisions of the family. The newfound ability of young rural women to seek independent advice from health practitioners shifted power over this important family decision from men and the extended family to women. At the societal level, it broadened the definition of a ‘good Muslim woman’ from one who obeys her husband and primarily engages in childbearing and domestic work, to one who has a say in important decisions about childbearing and child education.