Social Capital as Good Culture

Luigi Guiso, Paola Sapienza and Luigi Zingales

No ECO2007/57, Economics Working Papers from European University Institute

Abstract: To explain the extremely long-term persistence (more than 500 years) of positive historical experiences of cooperation (Putnam, 1993), we model the intergenerational transmission of priors about the trustworthiness of others. We show that this transmission tends to be biased toward excessively conservative priors. As a result, societies can be trapped in a low-trust equilibrium. In this context, a temporary shock to the return to trusting can have a permanent effect on the level of trust. We validate the model by testing its predictions on the World Values Survey data and the German Socio Economic Panel. We also present some anecdotal evidence that these priors are reflected in the novels originated in different parts of the country.

Keywords: social capital; culture; trust (search for similar items in EconPapers)
JEL-codes: A13 N00 O1 (search for similar items in EconPapers)
Date: 2007
New Economics Papers: this item is included in nep-ltv and nep-soc
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (38)

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Working Paper: Social Capital as Good Culture (2008)
Working Paper: Social Capital as Good Culture (2007)
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