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DO POSITIONAL CONCERNS DESTROY SOCIAL CAPITAL: EVIDENCE FROM 26 COUNTRIES
Author(s) -
FISCHER JUSTINA A.V.,
TORGLER BENNO
Publication year - 2013
Publication title -
economic inquiry
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.823
H-Index - 72
eISSN - 1465-7295
pISSN - 0095-2583
DOI - 10.1111/j.1465-7295.2011.00441.x
Subject(s) - social capital , economics , social mobility , demographic economics , position (finance) , norm (philosophy) , inequality , economic inequality , relative deprivation , survey data collection , income distribution , labour economics , public economics , development economics , political science , psychology , social psychology , finance , mathematical analysis , statistics , mathematics , law
Research on the effects of positional concerns on individuals' attitudes and behavior is sorely lacking. To address this deficiency, we use the International Social Survey Programme 1998 data on 25,000 individuals from 26 countries to investigate the impact of relative income position on three facets of social capital: horizontal and vertical trust as well as norm compliance. Testing relative deprivation theory, we identify a deleterious positional income effect for persons below the reference income, particularly for their social trust and confidence in secular institutions. Also often a social capital‐lowering effect of relative income advantage occurs, while a rise in absolute income almost always contributes positively. These results indicate that a rise in income inequality in a society too large is rather detrimental to the formation of social capital . ( JEL Z130, I300, D310)