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Political Inequality and the Origins of Distrust: Evidence for Colombia

  • Alvarez Villa, Daphne

This paper aims to identify the effect of political exclusion on social capital in Colombia, suggesting social capital as an important channel through which political inequality has been central for Colombian economic development. I use the Colombian National Front agreement during 1958-1974 to test my hypothesis, as it institutionalized the political exclusion of non-traditional parties in that country. Whereas it affected all regions at the same time, it implied differential effects according to the municipalities’ initial political diversity. The empirical strategy deals with the potential endogeneity in the variation of the treatment by using region fixed effects and relevant control variables in a cross-section model, as well as performing robustness checks. I further use panel fixed effects models with electoral turnout as a measure of social capital. I find that political exclusion imposed by the National Front may have led to less trusting individuals today, to a higher perception of free riding behaviors and to lower levels of electoral turnout. I also find that a possible channel through which political exclusion in the past may be able to explain social capital in the present is distrust towards the state.

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Paper provided by University of Munich, Department of Economics in its series Discussion Papers in Economics with number 17198.

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Date of creation: Aug 2013
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Handle: RePEc:lmu:muenec:17198
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  2. Knack, Stephen & Keefer, Philip, 1997. "Does Social Capital Have an Economic Payoff? A Cross-Country Investigation," The Quarterly Journal of Economics, MIT Press, vol. 112(4), pages 1251-88, November.
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  4. Edward L. Glaeser & David I. Laibson & José A. Scheinkman & Christine L. Soutter, 2000. "Measuring Trust," The Quarterly Journal of Economics, MIT Press, vol. 115(3), pages 811-846, August.
    • Glaeser, Edward Ludwig & Laibson, David I. & Scheinkman, Jose A. & Soutter, Christine L., 2000. "Measuring Trust," Scholarly Articles 4481497, Harvard University Department of Economics.
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  9. Nunn, Nathan & Wantchekon, Leonard, 2011. "The Slave Trade and the Origins of Mistrust in Africa," Scholarly Articles 11986331, Harvard University Department of Economics.
  10. Elinor Ostrom, 2000. "Collective Action and the Evolution of Social Norms," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 137-158, Summer.
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