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Does Equality Lead to Fraternity?

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  • Andrew Leigh

    ()
    (SPEAR Centre, RSSS, ANU)

Abstract

Several cross-country studies have observed a negative correlation between inequality and interpersonal trust. Using data from 59 countries, I instrument for inequality using the relative size of the mature-aged cohort, and find that a rise in inequality reduces trust.

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Bibliographic Info

Paper provided by Centre for Economic Policy Research, Research School of Economics, Australian National University in its series CEPR Discussion Papers with number 513.

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Length: 13 pages
Date of creation: Jan 2006
Date of revision:
Handle: RePEc:auu:dpaper:513

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Keywords: Trust; inequality; ethnic fractionalization; instrumental variables;

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References

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  1. Alesina, Alberto F & La Ferrara, Eliana, 2000. "Who Trusts Others?," CEPR Discussion Papers, C.E.P.R. Discussion Papers 2646, C.E.P.R. Discussion Papers.
  2. Andrew Leigh, 2006. "Trust, Inequality, and Ethnic Heterogeneity," CEPR Discussion Papers, Centre for Economic Policy Research, Research School of Economics, Australian National University 511, Centre for Economic Policy Research, Research School of Economics, Australian National University.
  3. Alberto Alesina & Arnaud Devleeschauwer & William Easterly & Sergio Kurlat & Romain Wacziarg, 2003. "Fractionalization," NBER Working Papers 9411, National Bureau of Economic Research, Inc.
  4. Marcel Fafchamps & Steven N. Durlauf, 2004. "Social Capital," Economics Series Working Papers WPS/2004-14, University of Oxford, Department of Economics.
    • Durlauf, Steven N. & Fafchamps, Marcel, 2005. "Social Capital," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 26, pages 1639-1699 Elsevier.
  5. Andrea Brandolini & Anthony B. Atkinson, 2001. "Promise and Pitfalls in the Use of "Secondary" Data-Sets: Income Inequality in OECD Countries As a Case Study," Journal of Economic Literature, American Economic Association, vol. 39(3), pages 771-799, September.
  6. Glaeser, Edward Ludwig & Laibson, David I. & Scheinkman, Jose A. & Soutter, Christine L., 2000. "Measuring Trust," Scholarly Articles 4481497, Harvard University Department of Economics.
  7. Marcel Fafchamps, 2004. "Social Capital and Development," Economics Series Working Papers 214, University of Oxford, Department of Economics.
  8. Orana Bandiera & Iwan Barankay & Imran Rasul, 2005. "Cooperation in collective action," Natural Field Experiments 00211, The Field Experiments Website.
  9. Knack, Stephen & Keefer, Philip, 1997. "Does Social Capital Have an Economic Payoff? A Cross-Country Investigation," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 112(4), pages 1251-88, November.
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Citations

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Cited by:
  1. Jordahl, Henrik, 2007. "Inequality and Trust," Working Paper Series, Research Institute of Industrial Economics 715, Research Institute of Industrial Economics.
  2. Yamamura, Eiji, 2008. "The role of social capital in homogeneous society: Review of recent researches in Japan," MPRA Paper 11385, University Library of Munich, Germany.
  3. Yamamura, Eiji, 2013. "Natural disasters and social capital formation: The impact of the Great Hanshin-Awaji earthquake," MPRA Paper 44493, University Library of Munich, Germany.
  4. Andrew Leigh, 2006. "Trust, Inequality and Ethnic Heterogeneity," The Economic Record, The Economic Society of Australia, The Economic Society of Australia, vol. 82(258), pages 268-280, 09.
  5. Yamamura, Eiji, 2010. "The role of social trust in reducing long-term truancy and forming human capital in Japan," MPRA Paper 23759, University Library of Munich, Germany.
  6. repec:ebl:ecbull:v:26:y:2008:i:1:p:1-9 is not listed on IDEAS
  7. Olivera, J., 2013. "GINI DP 80: On changes in general trust in Europe," GINI Discussion Papers 80, AIAS, Amsterdam Institute for Advanced Labour Studies.
  8. Yamamura, Eiji & Antonio R, Andrés, 2011. "Trust and Fertility: Evidence from OECD countries," MPRA Paper 29978, University Library of Munich, Germany.
  9. repec:aia:ginidp:dp17 is not listed on IDEAS
  10. Giacomo Corneo, 2011. "GINI DP 17: Income Inequality, Value Systems and Macroeconomic Performance," GINI Discussion Papers 17, AIAS, Amsterdam Institute for Advanced Labour Studies.
  11. Eiji Yamamura, 2008. "Determinants of trust in a racially homogeneous society," Economics Bulletin, AccessEcon, vol. 26(1), pages 1-9.
  12. Sarah Bulloch, 2013. "Seeking Construct Validity in Interpersonal Trust Research: A Proposal on Linking Theory and Survey Measures," Social Indicators Research, Springer, Springer, vol. 113(3), pages 1289-1310, September.
  13. Hilde Coffé, 2009. "Social Capital and Community Heterogeneity," Social Indicators Research, Springer, Springer, vol. 91(2), pages 155-170, April.
  14. Dierk Herzer & Peter Nunnenkamp, 2011. "Income Inequality and Health: New Evidence from Panel Data," Kiel Working Papers 1736, Kiel Institute for the World Economy.
  15. Javier Olivera, 2013. "On changes in general trust in Europe," Working Papers, Geary Institute, University College Dublin 201301, Geary Institute, University College Dublin.
  16. Yamamura, Eiji, 2008. "The effects of inequality, fragmentation, and social capital on collective action in a homogeneous society: Analyzing responses to the 2005 Japan Census," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, Elsevier, vol. 37(5), pages 2054-2058, October.

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