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Inherited Trust and Growth - Comment

Daniel Müller, Benno Torgler and Eric Uslaner ()
Authors registered in the RePEc Author Service: Daniel Müller

CREMA Working Paper Series from Center for Research in Economics, Management and the Arts (CREMA)

Abstract: Algan and Cahuc in "Inherited Trust and Growth" (AER, 2010) argue that "inherited trust" is a key factor in explaining growth rates across countries. They derive a measure of inherited trust by linking respondents’ "home countries" in the United States General Social Survey (1972-2004) and the 2000 wave of the World Values Survey. Algan and Cahuc then estimate trust levels for people born before 1910 (inherited trust in 1935) and afterwards (inherited trust in 2000). They show a strong link between economic growth rates and inherited trust. We do not challenge this result, but we do argue that: (1) the 2000 World Values Survey has many anomalous results; (2) the estimates for inherited trust in 1935 are mostly based upon tiny samples for most ethnic heritage groups in the General Social Survey; and (3) Algan and Cahuc’s findings are based upon two-tailed rather than one-tailed tests. We reestimate their model using the more reliable waves of the World Values Survey and find much weaker relationships between inherited trust in 1935 and trust in the home country. We also suggest caution in the overall measure of inherited trust in 1935.

Keywords: inherited trust; generalized trust; US immigrants (search for similar items in EconPapers)
JEL-codes: N31 N32 Z12 Z13 (search for similar items in EconPapers)
Date: 2012-04
New Economics Papers: this item is included in nep-cbe, nep-evo and nep-soc
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