Culture and Institutions
On the Joint Dynamics of Culture and Political Institutions: Elites and Civil Society,
with Thierry Verdier, Journal of Political Economy, forthcoming 2023 (first draft 2015)
We provide an abstract model of the interaction between culture and political institutions.The model is designed to study the political economy of elites and civil society on the determination of long-run socio-economic activity. We characterize conditions such that the cultural traits of elites and civil society and the institutions determining their relative political power complement (resp. substitute) each other, giving rise to a multiplier effect which amplifies (resp. dampens) their combined ability to spur socio-economic activity. We show how the joint dynamics may display hysteresis, oscillations, depending on the form of the interactionbetween elites and civil society.
Culture, Institutions & the Long Divergence,
with Jared Rubin, Avner Seror, and Thierry Verdier, Journal of Economic Growth, forthcoming 2023.
During the medieval and early modern periods the Middle East lost its economic advantage relative to the West. Recent explanations of this historical phenomenon—called the Long Divergence—focus on these regions’ distinct political economy choices regarding religious legitimacy and limited governance. We study these features in a political economy model of the interactions between rulers, secular and clerical elites, and civil society. The model induces a joint evolution of culture and political institutions converging to one of two distinct stationary states: a religious and a secular regime. We then map qualitatively parameters and initial conditions characterizing the West and the Middle East into the implied model dynamics to show that they are consistent with the Long Divergence as well as with several key stylized political and economic facts. Most notably, this mapping suggests non-monotonic political economy dynamics in both regions, in terms of legitimacy and limited governance, which indeed characterize their history.
Marriage, Fertility, and Cultural Integration in Italy,
with Giulia Tura, NEW DRAFT, 2022 (first draft 2018).
We study the cultural integration of immigrants in Italy, estimating a structural model of marital matching and fertility along ethnic dimensions. We exploit rich administrative demographic data on the universe of marriages, births and separations from 1995 to 2012. We estimate strong preferences of ethnic minorities’ towards socialization of children to their own identity as well as high cultural intolerance of Italians towards immigrant minorities. In long-run simulations, we find that cultural intolerances, as well as fertility and homogamy rates, slow-down the cultural integration of some immigrant ethnic minorities, especially Latin America, East Asia and Sub-Saharan Africa. Nonetheless, 75% of immigrants integrate into the majoritarian culture over the period of a generation. We show by counterfactual analysis that a lower cultural intolerance of Italians towards minorities would lead to slower cultural integration by allowing immigrants a more widespread use of their own language rather than Italian in heterogamous marriages. Finally, we quantitatively assess the effects of large future immigration inflows.
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Advances in the Economic Theory of Cultural Transmission,
with Thierry Verdier, Annual Review of Economics, forthcoming 2023.
In this paper we survey recent advances in the economic theory of cultural transmission. We highlight three main themes on which the literature has made great progress in the last ten years: the domain of traits subject to cultural transmission, the micro-foundations for the technology of transmission, and feedback effects between culture, institutions, and various socio-economic environments. We conclude suggesting interesting areas for future research.
Cultural Transmission and Religion,
with Jean-Paul Carvalho and Thierry Verdier, Handbook on the Economics of religion, Robert Sauer, Ed., World Scientific Publishing, forthcoming 2022.
Based on population dynamics models, the literature on cultural transmission has studied the formation and diffusion of religious traits through evolutionary and bottom-up forces such as parental socialization. This chapter provides a bird’s eye view of this approach and its main extensions. We also emphasize two additional dimensions of the cultural dynamics of religious preferences. The first is cultural blending and religious syncretism, namely the fusion of diverse religious beliefs and practices. The second highlights the importance of purposeful and centralized authorities, such as religious leaders and institutions, that influence the cultural dynamics of religious beliefs and preferences.
Merger or Acquisition? Introduction to the Handbook of Historical Economics,
with Giovanni Federico, Handbook of Historical Economics, Alberto Bisin and Giovanni Federico, Eds., Academic Press, 2021.
Historical Economics was born arguably in the 1960s, with the so-called Cliometric revolution. Now, arguably, a second revolution is unfolding, as the field is attracting the renewed interest of economists. Good Historical Economics needs a combination of
the knowledge of sources and detailed historical events and phenomena, the capability of distilling complex historical processes into a model to put forward alternative testable hypotheses, the statistical/econometric skills for identification, causal inference, structural estimation, and testing, the detailed knowledge of specific political
and socio-economic institutions, an understanding of the role of cultural traits, e.g., ethnic/religious, and of their evolution. This Handbook is a step in this direction, and this Introduction written jointly by an economist and an historian, discussing the pitfalls of their own disciplines, should serve as a suggestion that it can be done
Late for History,
with Andrea Moro, Handbook of Historical Economics, Alberto Bisin and Giovanni Federico, Eds., Academic Press, 2021.
In Historical Economics, Persistence studies document the persistence of
some historical phenomenon or leverage this persistence to identify causal relationships of interest in the present. In this chapter, we analyze the implications of allowing for heterogeneous treatment effects in these studies. We delineate
their common empirical structure, argue that heterogeneous treatment effects are likely in their context, and propose minimal abstract models that help interpret results and guide the development of empirical strategies to uncover the mechanisms generating the effects.
Phase Diagrams in Historical Economics: Culture and Institutions,
with Thierry Verdier, Handbook of Historical Economics, Alberto Bisin and Giovanni Federico, Eds., Academic Press, 2021.
In this paper we discuss the role of explicit formal dynamic models in our understanding of socio-economic history. Specifically, to illustrate the methodological issue, we center our analysis on studies of institutional and cultural change. Finally, we study in detail a dynamic model of institutions for property rights protection and culture of conflict as an example.
A Comment on: State Capacity, Reciprocity, and the Social Contract, by Timothy Besley,
Econometrica, Vol. 88, No. 4, July, 1345–1349, 2020.
Besley’s paper studies the role of civic culture in expanding fiscal capacity. I read this paper through the eyes of models of institutions and culture in economic development. First of all, I will argue that the results of the paper hold qualitatively in different models displaying complementarity between civic culture and public good provision. I will then illustrate how an analysis of the institutional design of the polity of the state in the context of the model produces a rich set of novel implications with regards to institutional change and to the institutional correlates of civic capital, state capacity and public goods provision. I will then show that relaxing the assumption that elites have commitment also produces interesting implications for the study o culture and institutions. Finally, I will briefly speculate on the dynamics of civic culture if inter-generational cultural transmission is characterized by some form of imperfect altruism on the parts of the parents.
Religious Legitimacy and the Joint Evolution of Culture and Institutions
with Avner Seror and Thierry Verdier, Advances in the Economics of Religion, Sriya Iyer, Jared Rubin, and Jean-Paul Carvalho, Eds., Palgrave, 2018.
Religious legitimacy is becoming a central concept in historical economics, in comparative studies of the political economy of preindustrial societies in particular. In this short essay we provide some preliminary insights on the emergence of religious legitimacy in the context of the general theory of the evolution of institutions and culture. We show that it is the interaction of institutions and culture that is responsible for the most relevant implications of religious legitimacy in terms of economic growth and prosperity.
The Evolution of Value Systems: A Review Essay on Ian Morris’ Foragers, Farmers, and Fossil Fuels,
Journal of Economic Literature, 55(3), 1122–1135, 2017.
Foragers, Farmers, and Fossil Fuels: How Human Values Evolve is a large-scale history of the world through the different modes of production humanity has adopted over time and their implications in terms of moral values. Morris argues that the predominant value systems of human societies are cultural adaptations to the organizational structures of the societies themselves, their institutions, and ultimately to their modes of production. In particular, the book contains a careful analysis of how the hunting–gathering mode of production induces egalitarian values and relatively favorable attitudes toward violent resolution of conflicts, while farming induces hierarchical values and less favorable attitudes toward violence, and in turn the fossil fuel (that is, industrial) mode of production induces egalitarian values and nonviolent attitudes. The narrative in the book is rich, diverse, and ultimately entertaining. Morris’s analysis is very knowledgeable and informative: arguments and evidence are rooted in history, anthropology, archeology, and social sciences in general. Nonetheless, the analysis falls short of being convincing about the causal nature of the existing relationship between modes of production and moral value systems.
Inequality, redistribution and cultural integration in the Welfare State,
with Thierry Verdier, European Journal of Political Economy, 50, 122-40, 2017.
This paper constructs a simple theoretical political economy model to analyze the dynamic interactions between redistribution, public good provision and cultural integration of minority groups. Cultural differentiation erodes the support for general public good provision and vertical redistribution, reducing in turn the attractiveness of adoption of the mainstream culture by the minority groups. Our model shows the possibility for multiple politico-cultural steady state trajectories depending strongly on the initial degree of cultural differentiation in the society. An exogenous increase in income inequality is shown to increase the likelihood of multiple steady state trajectories. In a context with multiple minority groups, cultural fragmentation favors integration into the mainstream culture.
Time-consistent immigration policy under economic and cultural externalities
with Giulio Zanella, Economic Policy, 415-446, 2017.
Discussions of immigration policy are typically framed in the context of their economic effects in receiving countries, notably labour market and fiscal effects. In this paper, we characterize immigration policy in a richer model where migrants are also a source of cultural externalities stemming from either preferences or the functioning of formal and informal institutions in receiving countries. While in terms of pure economic effects, immigrants do not generally have any more incentives than low-skilled natives to allow for more immigration in the future, this is not the case when accounting for cultural externalities. Therefore, insofar as past immigrants have a voice in affecting future policies, a time-consistent immigration policy entails back-loading; as natives attempt at limiting voice of immigrants in the future, the economic effects of immigration flows as well as the cultural externality they introduce. Furthermore, natives exploit any pre-commitment device to limit immigration flows, e.g. building ‘‘walls’’, limiting immigrants’ political rights, or accumulating fiscal surpluses.
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“Bend It Like Beckham:” Ethnic Identity and Integration,
with Eleonora Patacchini, Thierry Verdier, Yves Zenou, European Economic Review, 90, 146–164, 2016.
We propose a theoretical framework to study the determinants of ethnic and religious identity along two distinct motivational processes: cultural distinction and cultural conformity. Under cultural conformity, ethnic identity is reduced by neighborhood integration, which weakens group loyalties and prejudices. On the contrary, under cultural distinction, ethnic minorities are more motivated in retaining their own distinctive cultural heritage the more integrated are the neighborhoods where they reside and work. Using data on ethnic preferences and attitudes provided by the Fourth National Survey of Ethnic Minorities in the UK we find evidence that might be consistent with intense ethnic and religious identity mostly formed as a cultural distinction mechanism. Consistently, we document that ethnic identities might be more intense in mixed than in segregated neighborhoods.
Coévolution entre institutions et culture : une application au développement de long terme,
with Thierry Verdier, Conference Jean-Jacques Laffont, Revue d’Economie Politique, 126(5), 653-81, 2016.
This paper proposes a formal framework to study the coevolution between institutions and culture and their implications in terms of socio-economic results. Institutional change is described as a process to resolve the fundamental problems of policy credibility among social groups. Cultural evolution is modeled as an intergenerational transmission process within a dynamic populations. Wes characterize the institutional and cultural dynamics as reinforcing each other (dynamic complementarities) or mitigating each other (dynamic substitutabilities) and we discuss the empirical implications of the comparative dynamics. An example applied to the case of economic modernization and structural change is presented.
Trade and cultural diversity,
with Thierry Verdier, Handbook of Art and Culture, in Victor A. Ginsburgh and David Throsby, Eds., Elsevier 2013.
This chapter surveys the recent economic literature on the relationships between globalization and cultural diversity. We first review the different channels through which international integration interacts with cultural diversity across individuals, communities, and nations. We then present some recent formal economic models of cultural transmission and cultural evolution and show how these models can be embedded into standard economic frameworks to analyze the links between globalization and cultural diversity. The chapter then presents various applications from trade in cultural goods, foreign direct investment in tourism to cultural integration of foreign migrants. Finally, normative implications and the relationships between cultural policy and international policies are also discussed.
Cultural Integration in Italy,
with Eleonora Patacchini, Immigration and Cultural Integration in Europe, Yann Algan, Alberto Bisin, Alan Manning, Thierry Verdier, Eds., CEPR-Oxford University Press, 2013.
This chapter explores economic and cultural integration patterns for different immigrant groups in Italy, from first to second generations and across age cohorts. The chapter produces descriptive statistics regarding the differences of immigrants with respect to natives in terms of education, employment, female participation rates, marriage, divorce, exogamous marriage rates, and completed fertility rates. The analysis does not show evidence of slow integration patterns for immigrants into Italy, though inter-marriage rates between immigrants and natives are very low. Severe data limitations, however, suggest caution in the interpretation of these results.
Immigrants and the Labor Market,
with Eleonora Patacchini, Thierry Verdier, and Yves Zenou, Economic Policy, 26(65), 57-92, 2011.
We study the relationship between ethnic identity and labour market outcomes of non-EU immigrants in Europe. Using the European Social Survey, we find that there is a penalty to be paid for immigrants with a strong identity. Being a first generation immigrant leads to a penalty of about 17% while second generation immigrants have a probability of being employed that is not statistically different from that of natives. However, when they have a strong identity, second-generation immigrants have a lower chance of finding a job than natives. Our analysis also reveals that the relationship between ethnic identity and employment prospects may depend on the type of integration and labour market policies implemented in the country where the immigrant lives. More flexible labour markets help immigrants to access the labour market but do not protect those who have a strong ethnic identity
Formation and Persistence of Oppositional Identities,
with Eleonora Patacchini, Thierry Verdier, and Yves Zenou, European Economic Review, 55, 1046-71, 2011.
We develop a dynamic model of identity formation that explains why ethnic minorities may choose to adopt oppositional identities (i.e. some individuals may reject or not the dominant culture) and why this behavior may persist over time. We first show that the prevalence of an oppositional culture in the minority group cannot always be sustained in equilibrium. Indeed, because the size of the majority group is larger, there is an ‘‘imposed’’ process of exposition to role models from the majority group that favors the diffusion of mainstream values in the minority community. In spite of this, an oppositional culture in the minority group can nevertheless be sustained in steady state if there is enough cultural segmentation in terms of role models, or if the size of the minority group is large enough, or if the degree of oppositional identity it implies is high enough. We also demonstrate that the higher the level of harassment and the number of racist individuals in the society, the more likely an oppositional minority culture will emerge. We finally show that ethnic identity and socialization effort can be more intense in mixed rather than segregated neighborhoods.
Social Economics: A Brief Introduction to the Handbook,
with Jess Benhabib and Matthew Jackson, Handbook of Social Economics, Jess Benhabib, Alberto Bisin, Matt Jackson, Eds., Elsevier, 2010.
Social economics is the study, with the methods of economics, of social phenomena in which aggregates affect individual choices. Such phenomena include, just to mention a few, social norms and conventions, cultural identities and stereotypes, peer and neighborhood effects. Social economics is to be distinguished therefore from Economic sociology, which may be thought of as the study, with the methods of sociology, of economic phenomena, e.g., markets. The aim of this handbook is to illustrate the intellectual vitality and richness of the recent literature in Social economics by organizing its main contributions in a series of surveys
The Economics of Cultural Transmission and Socialization,
with Thierry Verdier, Handbook of Social Economics, Jess Benhabib, Alberto Bisin, Matt Jackson, Eds., Elsevier, 2010.
This paper presents a survey of the theoretical and empirical literature on cultural transmission and socialization.
Social Construction of Preferences: Advertising,
with Jess Benhabib, Handbook of Social Economics, Jess Benhabib, Alberto Bisin, Matt Jackson, Eds., Elsevier, 2010.
We examine, with the tools of economics, a fundamental tenet of some of the most recent theoretical work in sociology, which we refer to as the Postmodernist Critique: preferences are socially constructed, firms exploit their monopoly power through advertising in order to create new (false) needs in consumers, and, as a consequence, consumer spending rises, and so does their supply of labor.
Cultural Transmission, Socialization and the Population Dynamics of Multiple State Traits Distributions,
with Giorgio Topa and Thierry Verdier, International Journal of Economic Theory, 5(1), 139-154 (special issue in honor of Jess Benhabib), March 2009.
This paper studies the population dynamics of multiple preference traits in a model of intergenerational cultural transmission. Parents socialize and transmit their preferences to their children with endogenous intensities. Populations concentrated on a single cultural group are in general not stable. There is a unique stable stationary distribution, and it supports two or more cultural groups, in particular those with greater intolerance with respect to others’ traits. The larger the heterogeneity of intolerance levels across cultural groups, the smaller the number of traits that are supported in the stable stationary distribution.
Cultural Transmission,
with Thierry Verdier, The New Palgrave Dictionary of Economics, Second Edition, Steven Durlauf and Larry Blume, Eds., Palgrave Macmillan, 2008.
The economic literature analyses cultural transmission as the result of interactions between purposeful socialization decisions inside the family (‘direct vertical socialization’) and indirect socialization processes like social imitation and learning (‘oblique and horizontal socialization’). This article reviews the main contribution of these models from theoretical and empirical perspectives. It presents the implications regarding the long-run population dynamics of cultural traits, and discusses the links with other approaches to cultural evolution in the social sciences as well as in evolutionary biology. Applications to economic problems are also briefly surveyed.
Are Muslim Immigrants Different in Terms of Cultural Integration?,
with Eleonora Patacchini, Thierry Verdier, Yves Zenou, Journal of the European Economic Association, 6(2-3), 445-56, 2008.
Using the UK Fourth National Survey of Ethnic Minorities, we document differences in integration patterns between Muslims and non-Muslims. We find that Muslims integrate less and more slowly than non-Muslims. In terms of estimated probability of having a strong religious identity, a Muslim born in the UK and having spent there more than 30 years is comparable with a non-Muslim just arrived in the country. Moreover, higher levels of income as well as higher on-the-job qualifications seem to be associated with a stronger religious identity for Muslim immigrants only. Finally, we find no evidence that segregated neighborhoods breed intense religious and cultural identities for ethnic minorities, in general, and, in particular, for Muslims.
An Empirical Analysis of Religious Homogamy and Socialization in the U.S,
with Giorgio Topa and Thierry Verdier, Journal of Political Economy, 112(3), 615-64, 2004.
This paper presents an empirical analysis of a choice-theoretic model of cultural transmission. In particular, we use data from the General Social Survey to estimate the structural parameters of a model of marriage and child socialization along religious lines in the United States. The observed intermarriage and socialization rates are consistent with Protestants, Catholics, and Jews having a strong preference for children who identify with their own religious beliefs and making costly decisions to influence their children’s religious beliefs. Our estimates imply dynamics of the shares of religious traits in the population that are in sharp contrast with the predictions obtained by linear extrapolations from current intermarriage rates.
Cooperation and Cultural Transmission,
with Giorgio Topa and Thierry Verdier, Rationality and Society, 16, 477-507, 2004.
In this paper, we study an endogenous cultural selection mechanism for cooperative behavior in a setting where agents are randomly matched in a one-shot interaction Prisoner’s Dilemma, and may or may not have complete information about their opponent’s preferences. We focus on an endogenous socialization mechanism in which parents spend costly effort to transmit directly their trait to their offspring, taking into account the impact of (oblique) societal pressures on cultural transmission. For various ranges of parameter values, this mechanism generates a polymorphic population with a long-run presence of cooperative agents, even where replicator and indirect evolutionary mechanisms would bring about a monomorphic population with non-cooperation. Further, under some circumstances, the long-run fraction of cooperative agents is shown to be larger under incomplete than complete information.
Empirical Models of Cultural Transmission,
with Giorgio Topa, Journal of the European Economic Association, 1(2), 363-75, 2003.
This paper reviews several issues concerning an empirical analysis of the endogenous formation of preferences, as well as cognitive and psychological traits. In particular we show by means of examples how, with existing data, it is possible to identify empirically the distinct influence of family and society at large in the determination of cultural traits, and to disentangle genetic inheritability from cultural and environmental factors determining cognitive and psychological traits.
The Economics of Cultural Transmission and the Evolution of Preferences,
with Thierry Verdier, Journal of Economic Theory, 97(2), 298-319, 2001.
This paper studies the population dynamics of preference traits in a model of intergenerational cultural transmission. Parents socialize and transmit their preferences to their offspring, motivated by a form of paternalistic altruism (“imperfect empathy”). In such a setting we study the long run stationary state pattern of preferences in the population, according to various socialization mechanisms and institutions, and identify sufficient conditions for the global stability of an heterogenous stationary distribution of the preference traits. We show that cultural transmission mechanisms have very different implications than evolutionary selection mechanisms with respect to the dynamics of the distribution of the traits in the population, and we study mechanisms which interact evolutionary selection and cultural transmission.
Agents with Imperfect Empathy May Survive Natural Selection,
with Thierry Verdier, Economics Letters, 71, 277-85, 2001.
Cultural transmission mechanisms which favor the direct transmission of the parents’ traits to their children may be adaptive to natural selection when opposed to mechanisms in which the parents choose for the offspring the highest fitness at any time.
Models of Cultural Transmission, Voting and Political Ideology,
with Thierry Verdier, European Journal of Political Economy, 16, 5-29, 2000.
In this paper, we present a model of cultural transmission of preferences on goods, some of which are provided publicly through simple majority voting. We emphasize the existence of a two-way causality between socialization decisions and political outcomes. This generates the possibility of indeterminacies and multiple self-fulfilling equilibrium paths in cultural change and politics. We provide then a rationale for ideologies and collective socialization institutions as coordination mechanisms allowing cultural groups to preserve or shift political power in favor of their preference profile in the long run.
Beyond the Melting Pot: Cultural Transmission, Marriage, and the Evolution of Ethnic and Religious Traits,
with Thierry Verdier, Quarterly Journal of Economics, CXV(3), 955-988, 2000.
This paper presents an economic analysis of the intergenerational transmission of ethnic and religious traits through family socialization and marital segregation decisions. Frequency of intra-group marriage (homogamy), as well as socialization rates of religious and ethnic groups, depend on the group’s share of the population: minority groups search more intensely for homogamous mates, and spend more resources to socialize their offspring. This pattern generally induces a dynamics of the distribution of ethnic and religious traits which converges to a culturally heterogeneous stationary population. Existing empirical evidence bearing directly and indirectly on the implications of the model is discussed.
On the Cultural Transmission of Preferences for Social Status,
with Thierry Verdier, Journal of Public Economics, 70, 75-97, 1998.
We study the formation of preferences for ‘social status’ as the result of intergenerational transmission of cultural traits. We characterize the behavior of parents with preferences for status in terms of socialization of their children to this particular cultural trait. We show that degenerate distributions of the population (whereby agents have either all status preferences or all non-status preferences) are dynamically unstable. Moreover, under some conditions, there exists a unique stationary distribution which is non-degenerate (in which both status and non-status preferences co-exist in the population), and this distribution is locally stable. Finally, we study the dependence of the stable stationary distribution of status preferences on institutional, technological and policy parameters which affect agents’ economic conditions.