Social and institutional factors as determinants of economic growth: Evidence from the United States counties**An earlier version of the article was presented at the North American Regional Science Association International meetings in Montreal in November 1999. We thank Jean†Claude Thill and three anonymous reviewers for comments that improved earlier drafts

In the search for explanations of persistent differences in economic growth rates, the conditional convergence growth model has introduced the possibility of incorporating a wide set of factors as determinants of growth. Controlling for spatial dependence, we assess the contribution of differences in social and institutional variables on growth rates of per capita income for counties in the United States. The empirical results indicate that, ceteris paribus, social and institutional variables explain some of the differences in convergence rates among counties. In particular, (i) ethnic diversity is associated with faster rates of economic growth; (ii) higher levels of income inequality are associated with lower rates; and (iii) higher levels of social capital have a positive effect on economic growth rates.