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What Determines Trust? Human Capital vs. Social Institutions: Evidence from Manila and Moscow

Author

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  • John Nye

    (Department of Economics MSN 1D3, George Mason University, Fairfax, VA 22030, USA, and Laboratory for Institutional Analysis of Economic Reforms, Higher School of Economics, Moscow, Russia, 101000)

  • Gregory Androuschak

    (Laboratory for Institutional Analysis of Economic Reforms, Higher School of Economics, Moscow, Russia, 101000)

  • Desiree Desierto

    (University of the Philippines School of Economics, Diliman, Quezon City 1101, Philippines)

  • Garett Jones

    (Department of Economics, George Mason University, Fairfax, VA 22030, USA)

  • Maria Yudkevich

    (Laboratory for Institutional Analysis of Economic Reforms, Higher School of Economics, Moscow, Russia, 101000)

Abstract

It is now well established that highly developed countries tend to score well on measures of social capital and have higher levels of generalized trust. In turn, the willingness to trust has been shown to be correlated with various social and environmental factors (e.g. institutions, culture) on one hand, and accumulated human capital on the other. To what extent is an individual’s trust driven by contemporaneous institutions and environmental conditions and to what extent is it determined by the individual’s human capital? We collect data from students in Moscow and Manila and use the variation in their height and gender to instrument for measures of their human capital to identify the causal effect of the latter on trust. We find that human capital positively affects the propensity to trust, and its contribution appears larger than the combined effect of other omitted variables including, plausibly, social and environmental factors.

Suggested Citation

  • John Nye & Gregory Androuschak & Desiree Desierto & Garett Jones & Maria Yudkevich, 2012. "What Determines Trust? Human Capital vs. Social Institutions: Evidence from Manila and Moscow," HSE Working papers WP BRP 18/EC/2012, National Research University Higher School of Economics.
    • Handle: RePEc:hig:wpaper:18/ec/2012
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    References listed on IDEAS

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    Cited by:

    1. John V.C. Nye & Sergiy Polyachenko, 2013. "Does education or underlying human capital explain liberal economic attitudes?," HSE Working papers WP BRP 40/EC/2013, National Research University Higher School of Economics.
    2. Anastasiia V. Rassadovskaia & Andrey V. Aistov, 2014. "Corruption Perceptions In Russia: Economic Or Social Issue?," HSE Working papers WP BRP 57/EC/2014, National Research University Higher School of Economics.

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    More about this item

    Keywords

    trust; education; human capital; institutions;
    All these keywords.

    JEL classification:

    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development

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