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Do Welfare Programs Damage Interpersonal Trust?: Experimental Evidence from Representative Samples for Four Latin American Cities

Author

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  • Ríos, Vanessa
  • Chong, Alberto E.
  • Ñopo, Hugo R.

Abstract

This paper argues that welfare programs are linked with the destruction of social capital, as measured by interpersonal trust in laboratory games. The paper employs experimental data for representative samples of individuals in four Latin American capital cities (Bogota, Lima, Montevideo, and San Jose), finding that participation in welfare programs damage trust. This result is robust to the inclusion of individual risk measures and a broad array of controls. The findings also support the notion that low take-up rates may be due to stigma linked with trust and social capital, rather than transaction costs.

Suggested Citation

  • Ríos, Vanessa & Chong, Alberto E. & Ñopo, Hugo R., 2009. "Do Welfare Programs Damage Interpersonal Trust?: Experimental Evidence from Representative Samples for Four Latin American Cities," IDB Publications (Working Papers) 1639, Inter-American Development Bank.
    • Handle: RePEc:idb:brikps:1639
    DOI: http://dx.doi.org/10.18235/0010904
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    Cited by:

    1. is not listed on IDEAS
    2. Martin Leites & Gustavo Pereira & Andres Rius & Gonzalo Salas & Andrea Vigorito, 2017. "PROTOCOL: The effect of cash transfers on social solidarity: A systematic review," Campbell Systematic Reviews, John Wiley & Sons, vol. 13(1), pages 1-49.

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    Keywords

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    JEL classification:

    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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