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Do Positional Concerns Destroy Social Capital: Evidence from 26 Countries

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  • Justina A V Fischer

    ()
    (University of Mannheim)

  • Benno Torgler

    ()
    (QUT)

Abstract

Research on the effects of positional concerns on individuals’ attitudes and behavior is sorely lacking. To address this deficiency, we use the International Social Survey Programme 1998 data on 25’000 individuals from 26 countries to investigate the impact of relative income position on three facets of social capital, covering horizontal and vertical trust as well as norm compliance. Testing relative deprivation theory, we identify a deleterious positional income effect for persons below the reference income, particularly for their social trust and confidence in secular institutions. Also often a social capital-lowering effect of relative income advantage occurs, while a rise in absolute income almost always contributes positively. These results indicate that a rise in income inequality in society too large is rather detrimental to the formation of social capital.

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Bibliographic Info

Paper provided by School of Economics and Finance, Queensland University of Technology in its series School of Economics and Finance Discussion Papers and Working Papers Series with number 265.

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Length: 52 pages
Date of creation: 17 Feb 2011
Date of revision:
Handle: RePEc:qut:dpaper:265

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Keywords: Relative income; positional concerns; social capital; social norms; deprivation theory;

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  1. Do Positional Concerns Destroy Social Capital: Evidence from 26 Countries
    by maximorossi in NEP-LTV blog on 2011-02-14 12:25:23
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Cited by:
  1. Christian Bjørnskov & Axel Dreher & Justina A.V. Fischer & Jan Schnellenbach, 2010. "Inequality and Happiness: When Perceived Social Mobility and Economic Reality do not Match," CESifo Working Paper Series 3216, CESifo Group Munich.
  2. Fischer, Justina, 2011. "Living under the ‘right’ government: does political ideology matter to trust in political institutions? An analysis for OECD countries," MPRA Paper 33344, University Library of Munich, Germany.
  3. Javier Olivera, 2013. "On changes in general trust in Europe," Working Papers 201301, Geary Institute, University College Dublin.

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