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The (negative) effects of inequality on Social Capital

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  • Yilong Xu
  • Ginevra Marandola

Abstract

Inequality is perhaps one of the most challenging issues of our time. Empirical literature, using observational data, indicates that higher inequality is associated with lower social capital. Oftentimes, however, the causal effects of inequality are difficult to establish based on survey and empirical observations. To this end, we review a large body of experimental literature and assess the causal effects of inequality on experimental proxies for social capital. We find compelling evidence that inequality undermines trust, discourages cooperation, and encourages unethical behaviors. The overall effect on generosity is, however, less clear.

Suggested Citation

  • Yilong Xu & Ginevra Marandola, 2023. "The (negative) effects of inequality on Social Capital," Journal of Economic Surveys, Wiley Blackwell, vol. 37(5), pages 1562-1588, December.
    • Handle: RePEc:bla:jecsur:v:37:y:2023:i:5:p:1562-1588
    DOI: 10.1111/joes.12558
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