Network Effects and Welfare Cultures

Marianne Bertrand, Erzo Luttmer and Sendhil Mullainathan

Working Papers from Princeton, Woodrow Wilson School - Public and International Affairs

Abstract: This paper empirically examines the role of social networks in welfare participation. Social theorists from across the political spectrum have argued that network effects have given rise to a culture of poverty. Empirical work, however, has found it difficult to distinguish the effect of networks from unobservable characteristics of individuals and areas. We use data on language spoken to better infer an individual's network within an area. Individuals who are surrounded by others speaking their language have a larger pool of available contacts. Moreover, the network influence of this pool will depend on their welfare knowledge. We, therefore, focus on the differential effect of increased contact availability: does being surrounded by others who speak the same language increase welfare more for individuals from high welfare using language groups? The results strongly confirm the importance of networks in welfare participation.

Keywords: SOCIAL WELFARE; SOCIAL NETWORK; LANGUAGES (search for similar items in EconPapers)
JEL-codes: D83 H53 I3 R20 (search for similar items in EconPapers)
Pages: 35 pages
Date: 1998
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Citations: View citations in EconPapers (5)

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Related works:
Journal Article: Network Effects and Welfare Cultures (2000)
Working Paper: Network Effects and Welfare Cultures (1999)
Working Paper: Network Effects and Welfare Cultures (1999)
Working Paper: Network Effects and Welfare Cultures (1998)
Working Paper: Network Effects and Welfare Cultures (1998)
Working Paper: Network Effects and Welfare Cultures (1998)
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Persistent link: https://EconPapers.repec.org/RePEc:fth:priwpu:201

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