We combine two experiments and a survey to measure trust and trustworthiness - two key components of social capital. Standard attitudinal survey questions about trust predict trustworthy behavior in our experiments much better than they predict trusting behavior. Trusting behavior in the...

I analyze a new set of data on Korean American adoptees who were quasirandomly assigned to adoptive families. I find large effects on adoptees' education, income, and health from assignment to parents with more education and from assignment to smaller families. Parental education and family size...

The high variance of crime rates across time and space is one of the oldest puzzles in the social sciences; this variance appears too high to be explained by changes in the exogenous costs and benefits of crime. The authors present a model where social interactions create enough covariance...

We examine how people form social networks among their peers. We use a unique data set that tells us the volume of email between any two people in the sample. The data are from students and recent graduates of Dartmouth College. First-year students interact with peers in their immediate...

This paper uses a unique data set to measure peer effects among college roommates. Freshman year roommates and dormmates are randomly assigned at Dartmouth College. I find that peers have an impact on grade point average and on decisions to join social groups such as fraternities. Residential...

We propose an origination-and-contingent-distribution model of banking, in which liquidity demand by short-term investors (banks) can be met with cash reserves (inside liquidity) or sales of assets (outside liquidity) to long-term investors (hedge funds and pension funds). Outside liquidity is a...

Who should enforce laws or contracts: judges or regulators? Many Coasians, though not Coase himself, advocate judicial enforcement. We show that the incentives facing judges and regulators crucially shape this choice. We then compare the regulation of financial markets in Poland and the Czech...

This paper develops a model of the interaction between the supply of hatecreating stories from politicians and the willingness of voters to listen to hatred. Hatred is fostered with stories of an out-group's crimes, but the impact of these stories comes from repetition not truth. Hate-creating...

A central requirement in the design of a legal system is the protection of law enforcers from coercion by litigants through either violence or bribes. The higher the risk of coercion, the greater the need for protection and control of law enforcers by the state. Such control, however, also makes...

If economic growth relies upon the extent-of-the-market, then openness will decrease the connection between initial income and later growth. Alternatively, learning-by-doing models suggest that wealth will be more positively correlated with growth in open economies, because trade causes advanced...