Essays on Social Norms and Economic Change

Abstract: This dissertation consists of three empirical essays concerning social norms and their effect on economic outcomes. Each essays discusses a seperate subject. The first paper, Breaking the Glass Ceiling: Gender Norms and Women Executives in the United States studies social norms as a distal cause of differences between genders in corporate executive recruitment strategies. Using census-level panel data covering executive positions of large U.S. corporations, and matching regional data on gender norms, we explore whether gender norms are causally related with recruitment patterns at the executive floor. Controlling for legal institutions and quality of labor supply, we show that gender norms do indeed have a substantial and significant impact on executive recruitment patterns. The norms of both men and women have an effect, although the channels through which they operate differ: while the former operates mostly only in tandem with increasing education among women the latter has a strong direct effect. Further, we find that norms take about 15 years to materially affect recruitment decisions and that national level norms have a greater effect than regional norms.The second essay, Getting Used to Diversity? Immigration and Trust in Sweden, studies the effect of historical diversity on modern diversity’s effect on generalized trust using Swedish individual level trust data and historical diversity data reaching back over a century. The results show that present-day increases in diversity lowers social trust only in those regions who had high levels of diversity in the past. This effect is driven by non-Nordic immigration while immigrants from the other Nordic countries do not have any negative effect on trust. This results suggests that the historical experiences of diversity increases the saliency of group dividers based on region of birth, even over time. The third and last essay, The Effect of Business Incubators on Firm Size and Performance: The Case of ICT Firms in Southern Sweden, uses data on ICT firms both with and without incubator experience in Malmö and Lund, two towns in the very south of Sweden. The results show that the incubators located in these town do not positively affect their incumbents’ returns, employment, level of assets, or sales. In fact, while still located at the incubator, incubated firms have lower returns and sell less than comparable firms outside of the incubator. Previous results on the effects of incubation differ depending on the region studied suggesting that local context, including local entrepreneurial culture, is an important determinant of the effectiveness of business incubators.