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Social capital II: determinants of economic connectedness

Author

Listed:
  • Raj Chetty

    (Harvard University)

  • Matthew O. Jackson

    (Stanford University)

  • Theresa Kuchler

    (NYU Stern School of Business)

  • Johannes Stroebel

    (NYU Stern School of Business)

  • Nathaniel Hendren

    (Harvard University)

  • Robert B. Fluegge

    (Harvard University)

  • Sara Gong

    (NYU Stern School of Business)

  • Federico Gonzalez

    (Harvard University)

  • Armelle Grondin

    (Harvard University)

  • Matthew Jacob

    (Harvard University)

  • Drew Johnston

    (Harvard University)

  • Martin Koenen

    (Harvard University)

  • Eduardo Laguna-Muggenburg

    (Grammarly)

  • Florian Mudekereza

    (Harvard University)

  • Tom Rutter

    (Harvard University)

  • Nicolaj Thor

    (Harvard University)

  • Wilbur Townsend

    (Harvard University)

  • Ruby Zhang

    (Harvard University)

  • Mike Bailey

    (Meta Platforms)

  • Pablo Barberá

    (Meta Platforms)

  • Monica Bhole

    (Meta Platforms)

  • Nils Wernerfelt

    (Meta Platforms)

Abstract

Low levels of social interaction across class lines have generated widespread concern1–4 and are associated with worse outcomes, such as lower rates of upward income mobility4–7. Here we analyse the determinants of cross-class interaction using data from Facebook, building on the analysis in our companion paper7. We show that about half of the social disconnection across socioeconomic lines—measured as the difference in the share of high-socioeconomic status (SES) friends between people with low and high SES—is explained by differences in exposure to people with high SES in groups such as schools and religious organizations. The other half is explained by friending bias—the tendency for people with low SES to befriend people with high SES at lower rates even conditional on exposure. Friending bias is shaped by the structure of the groups in which people interact. For example, friending bias is higher in larger and more diverse groups and lower in religious organizations than in schools and workplaces. Distinguishing exposure from friending bias is helpful for identifying interventions to increase cross-SES friendships (economic connectedness). Using fluctuations in the share of students with high SES across high school cohorts, we show that increases in high-SES exposure lead low-SES people to form more friendships with high-SES people in schools that exhibit low levels of friending bias. Thus, socioeconomic integration can increase economic connectedness in communities in which friending bias is low. By contrast, when friending bias is high, increasing cross-SES interactions among existing members may be necessary to increase economic connectedness. To support such efforts, we release privacy-protected statistics on economic connectedness, exposure and friending bias for each ZIP (postal) code, high school and college in the United States at https://www.socialcapital.org .

Suggested Citation

  • Raj Chetty & Matthew O. Jackson & Theresa Kuchler & Johannes Stroebel & Nathaniel Hendren & Robert B. Fluegge & Sara Gong & Federico Gonzalez & Armelle Grondin & Matthew Jacob & Drew Johnston & Martin, 2022. "Social capital II: determinants of economic connectedness," Nature, Nature, vol. 608(7921), pages 122-134, August.
  • Handle: RePEc:nat:nature:v:608:y:2022:i:7921:d:10.1038_s41586-022-04997-3
    DOI: 10.1038/s41586-022-04997-3
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    JEL classification:

    • J0 - Labor and Demographic Economics - - General
    • R0 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General

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