Bowling alone : a review essay

social capital

Groups, social influences and inequality : a memberships theory perspective on poverty traps

poverty;education;inequality

Path Dependence in Aggregate Output

This paper studies an economy in which incomplete markets and strong complementarities interact to generate path dependent aggregate output fluctuations. An economy is said to be path dependent when the effect of a shock on the level of aggregate output is permanent in the absence of future offsetting shocks. Extending the model developed in Durlauf 11991(a),(b)). we analyze the evolution of an economy which consists of a countable infinity of industries. The production functions of individual firms in each industry are nonconvex and are linked through localized technological complementarities. The productivity of each firm at t is determined by the production decisions of technologically similar industries at t-1. No markets exist which allow firms and industries to exploit complementarities by coordinating production decisions. This market incompleteness produces several interesting effects on aggregate output behavior. First, multiple stochastic equilibria exist in aggregate activity. These equilibria are distinguished by differences in both the mean and the variance of output. Second, output movements are path dependent as aggregate productivity shocks indefinitely affect real activity by shifting the economy across equilibria. Third, when aggregate shocks are recurrent, the economy cycles between periods of boom and depression. Simulations of example economies illustrate how market incompleteness can produce rich aggregate dynamics.

A multinomial choice model of neighborhood effects

choice theory

Equilibrium concepts for social interaction models

equilibrium analysis;public choice

Social Capital

This paper surveys research on social capital. We explore the concepts that motivate the social capital literature, efforts to formally model social capital using economic theory, the econometrics of social capital, and empirical studies of the role of social capital in various socioeconomic outcomes. While our focus is primarily on the place of social capital in economics, we do consider its broader social science context. We argue that while the social capital literature has produced many insights, a number of conceptual and statistical problems exist with the current use of social capital by social scientists.We propose some ways to strengthen the social capital literature.development, growth, identification, inequality, networks, social capital, trust