Inequality and Trust: Some Inequalities are More Harmful than Others

Magnus Gustavsson and Henrik Jordahl

No 2006:3, Working Paper Series from Uppsala University, Department of Economics

Abstract: We present new evidence on the influence of income inequality on generalized trust. Using individual panel data from Swedish counties together with an instrumental variable strategy we find that differences in disposable income, and especially differences among people in the bottom half of the income distribution, are associated with lower trust. The relationship between income inequality and trust is particularly strong for people with a strong aversion against income differentials. We also find that the proportion of people born in a foreign country is negatively associated with trust.

Keywords: trust; social capital; inequality (search for similar items in EconPapers)
JEL-codes: C23 D31 Z13 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2006-01-17
New Economics Papers: this item is included in nep-cbe, nep-lam and nep-soc
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

Published in Journal of Public Economics, 2008, pages 348-365.

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Persistent link: https://EconPapers.repec.org/RePEc:hhs:uunewp:2006_003

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