IDEAS home Printed from https://ideas.repec.org/a/ucp/ecdecc/y2003v51i3p573-601.html
   My bibliography  Save this article

Trust, Membership in Groups, and Household Welfare: Evidence from KwaZulu-Natal, South Africa

Author

Listed:
  • Haddad, Lawrence
  • Maluccio, John A

Abstract

This paper explores the relationship between group membership and trust. Specifically, the authors examine (1) the importance of trust in the decision to join groups, (2) the subsequent ability of groups to generate trust, and (3) the influence of group membership and trust on a measure of well-being, per capita household income. They use longitudinal data from KwaZulu-Natal Province, South Africa, allowing them to control for potential simultaneity and measurement-error problems in the estimation. They disaggregate groups into financial and nonfinancial and “trust in people” by type of agent or actor. They can thus examine whether different types of trust are important for participating in different types of groups and whether different types of group participation are important for generating different types of trust. The research finds that (1) trust in local agents is an important determinant of membership in financial groups but not for membership in nonfinancial groups, (2) membership in both types of groups generates trust in nonlocal agents but not local agents, and (3) membership in financial and nonfinancial groups leads to higher well-being. The first two results suggest that financial groups serve a role in expanding the radius of trust, while the first and third results suggest a role for trust in improving well-being.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Haddad, Lawrence & Maluccio, John A, 2003. "Trust, Membership in Groups, and Household Welfare: Evidence from KwaZulu-Natal, South Africa," Economic Development and Cultural Change, University of Chicago Press, vol. 51(3), pages 573-601, April.
    • Handle: RePEc:ucp:ecdecc:y:2003:v:51:i:3:p:573-601
    DOI: 10.1086/374986
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1086/374986
    Download Restriction: Access to the online full text or PDF requires a subscription.
    File URL: https://libkey.io/10.1086/374986?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Alberto Alesina & Eliana La Ferrara, 2000. "Participation in Heterogeneous Communities," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 115(3), pages 847-904.
    2. Stephen Knack & Philip Keefer, 1997. "Does Social Capital Have an Economic Payoff? A Cross-Country Investigation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(4), pages 1251-1288.
    3. La Ferrara, Eliana, 2002. "Inequality and group participation: theory and evidence from rural Tanzania," Journal of Public Economics, Elsevier, vol. 85(2), pages 235-273, August.
    4. Narayan, Deepa, 1999. "Bonds and bridges : social and poverty," Policy Research Working Paper Series 2167, The World Bank.
    5. Bouis, Howarth E., 1994. "Agricultural technology and food policy to combat iron deficiency in developing countries," FCND discussion papers 1, International Food Policy Research Institute (IFPRI).
    6. Edward L. Glaeser & David Laibson & Bruce Sacerdote, 2002. "An Economic Approach to Social Capital," Economic Journal, Royal Economic Society, vol. 112(483), pages 437-458, November.
    7. Paul Glewwe & Margaret Grosh, 2000. "Designing Household Survey Questionnaires for Developing Countries," World Bank Publications - Books, The World Bank Group, number 25338.
    8. Narayan, Deepa & Pritchett, Lant, 1999. "Cents and Sociability: Household Income and Social Capital in Rural Tanzania," Economic Development and Cultural Change, University of Chicago Press, vol. 47(4), pages 871-897, July.
    9. Edward L. Glaeser & David I. Laibson & José A. Scheinkman & Christine L. Soutter, 2000. "Measuring Trust," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 115(3), pages 811-846.
      • Glaeser, Edward Ludwig & Laibson, David I. & Scheinkman, Jose A. & Soutter, Christine L., 2000. "Measuring Trust," Scholarly Articles 4481497, Harvard University Department of Economics.
    10. MICHAEL R. CARTER & Marco Castillo, 2002. "The Economic Impacts of Altruism, Trust and Reciprocity: An Experimental Approach to Social Capital," Wisconsin-Madison Agricultural and Applied Economics Staff Papers 448, Wisconsin-Madison Agricultural and Applied Economics Department.
    11. Alberto Alesina & Eliana La Ferrara, 2000. "The Determinants of Trust," NBER Working Papers 7621, National Bureau of Economic Research, Inc.
    12. Davidson, Russell & MacKinnon, James G., 1993. "Estimation and Inference in Econometrics," OUP Catalogue, Oxford University Press, number 9780195060119.
    13. Uphoff, Norman & Wijayaratna, C. M., 2000. "Demonstrated Benefits from Social Capital: The Productivity of Farmer Organizations in Gal Oya, Sri Lanka," World Development, Elsevier, vol. 28(11), pages 1875-1890, November.
    14. Zeller, Manfred, 1994. "Determinants of credit rationing: a study of informal lenders and formal credit groups in Madagascar," FCND discussion papers 2, International Food Policy Research Institute (IFPRI).
    15. John A. Maluccio, 2004. "Using Quality of Interview Information to Assess Nonrandom Attrition Bias in Developing‐Country Panel Data," Review of Development Economics, Wiley Blackwell, vol. 8(1), pages 91-109, February.
    16. Barr, Abigail, 2000. "Social Capital and Technical Information Flows in the Ghanaian Manufacturing Sector," Oxford Economic Papers, Oxford University Press, vol. 52(3), pages 539-559, July.
    17. Woolcock, Michael & Narayan, Deepa, 2000. "Social Capital: Implications for Development Theory, Research, and Policy," The World Bank Research Observer, World Bank, vol. 15(2), pages 225-249, August.
    18. Mr. Francis Fukuyama, 2000. "Social Capital and Civil Society," IMF Working Papers 2000/074, International Monetary Fund.
    19. Zeller, Manfred, 1998. "Determinants of Repayment Performance in Credit Groups: The Role of Program Design, Intragroup Risk Pooling, and Social Cohesion," Economic Development and Cultural Change, University of Chicago Press, vol. 46(3), pages 599-620, April.
    20. Zeller, Manfred, 1994. "Determinants of credit rationing: A study of informal lenders and formal credit groups in Madagascar," World Development, Elsevier, vol. 22(12), pages 1895-1907, December.
    21. John Maluccio & Lawrence Haddad & Julian May, 2000. "Social capital and household welfare in South Africa, 1993-98," Journal of Development Studies, Taylor & Francis Journals, vol. 36(6), pages 54-81.
    22. Wydick, Bruce, 1999. "Can Social Cohesion Be Harnessed to Repair Market Failures? Evidence from Group Lending in Guatemala," Economic Journal, Royal Economic Society, vol. 109(457), pages 463-475, July.
    23. Fafchamps, Marcel, 2000. "Ethnicity and credit in African manufacturing," Journal of Development Economics, Elsevier, vol. 61(1), pages 205-235, February.
    24. Julian May & Michael Carter & Lawrence Haddad & John Maluccio, 2000. "KwaZulu-Natal Income Dynamics Study (KIDS) 1993-98: A longitudinal household database for South African policy analysis," Development Southern Africa, Taylor & Francis Journals, vol. 17(4), pages 567-581.
    25. Bebbington, Anthony, 1999. "Capitals and Capabilities: A Framework for Analyzing Peasant Viability, Rural Livelihoods and Poverty," World Development, Elsevier, vol. 27(12), pages 2021-2044, December.
    26. Paolo Mauro, 1995. "Corruption and Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 110(3), pages 681-712.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Giuseppina Guagnano & Elisabetta Santarelli & Isabella Santini, 2016. "Can Social Capital Affect Subjective Poverty in Europe? An Empirical Analysis Based on a Generalized Ordered Logit Model," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 128(2), pages 881-907, September.
    2. Carter, Michael R. & Maluccio, John A., 2002. "Social capital and coping with economic shocks," FCND briefs 142, International Food Policy Research Institute (IFPRI).
    3. Isabella Santini & Anna de Pascale, "undated". "Social capital and its impact on poverty reduction: measurement issues in longitudinal and cross-country comparisons. Towards a unified framework in the European Union," Working Papers 101/12, Sapienza University of Rome, Metodi e Modelli per l'Economia, il Territorio e la Finanza MEMOTEF.
    4. Barr, Abigail, 2004. "Forging Effective New Communities: The Evolution of Civil Society in Zimbabwean Resettlement Villages," World Development, Elsevier, vol. 32(10), pages 1753-1766, October.
    5. Carter, Michael R. & Maluccio, John A., 2003. "Social Capital and Coping with Economic Shocks: An Analysis of Stunting of South African Children," World Development, Elsevier, vol. 31(7), pages 1147-1163, July.
    6. Miguel, Edward A. & Gertler, Paul & Levine, David I., 2003. "Did Industrialization Destroy Social Capital in Indonesia?," Center for International and Development Economics Research, Working Paper Series qt9kt2m860, Center for International and Development Economics Research, Institute for Business and Economic Research, UC Berkeley.
    7. Dufhues, Thomas & Buchenrieder, Gertrud & Fischer, Isabel, 2006. "Social capital and rural development: literature review and current state of the art [Sozialkapital und ländliche Entwicklung: Literaturüberblick und gegenwärtiger Stand der Forschung]," IAMO Discussion Papers 96, Leibniz Institute of Agricultural Development in Transition Economies (IAMO).
    8. DeanS. Karlan, 2007. "Social connections and group banking," Economic Journal, Royal Economic Society, vol. 117(517), pages 52-84, February.
    9. Yamamura, Eiji, 2008. "The role of social capital in homogeneous society: Review of recent researches in Japan," MPRA Paper 11385, University Library of Munich, Germany.
    10. Cristina Cattaneo, 2016. "Opting in to Opt out? Emigration and Group Participation in Albania," International Migration Review, Wiley Blackwell, vol. 50(4), pages 1046-1075, December.
    11. repec:zbw:iamodp:92017 is not listed on IDEAS
    12. Calvo, Thomas & Lavallée, Emmanuelle & Razafindrakoto, Mireille & Roubaud, François, 2020. "Fear Not For Man? Armed conflict and social capital in Mali," Journal of Comparative Economics, Elsevier, vol. 48(2), pages 251-276.
    13. repec:dau:papers:123456789/11437 is not listed on IDEAS
    14. Antoni, Giacomo Degli, 2007. "Do Social Relations Affect Economic Welfare? A Microeconomic Empirical Analysis," Knowledge, Technology, Human Capital Working Papers 9330, Fondazione Eni Enrico Mattei (FEEM).
    15. Haddad, Lawrence J. & Alderman, Harold & Appleton, Simon & Song, Lina & Yohannes, Yisehac, 2002. "Reducing child undernutrition: how far does income growth take us?," FCND briefs 137, International Food Policy Research Institute (IFPRI).
    16. Degli Antoni, Giacomo, 2009. "Does satisfaction matter? A microeconomic empirical analysis of the effect of social relations on economic welfare," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(2), pages 301-309, March.
    17. Bouma, Jetske & Bulte, Erwin & van Soest, Daan, 2008. "Trust and cooperation: Social capital and community resource management," Journal of Environmental Economics and Management, Elsevier, vol. 56(2), pages 155-166, September.
    18. Kasarjyan, Milada, 2011. "Improving the functioning of the rural financial markets of Armenia," Studies on the Agricultural and Food Sector in Transition Economies, Leibniz Institute of Agricultural Development in Transition Economies (IAMO), volume 62, number 62, September.
    19. Ann Owen & Julio Videras, 2009. "Reconsidering social capital: a latent class approach," Empirical Economics, Springer, vol. 37(3), pages 555-582, December.
    20. Zugravu-Soilita, Natalia & Kafrouni, Rajwane & Bouard, Séverine & Apithy, Leïla, 2021. "Do cultural capital and social capital matter for economic performance? An empirical investigation of tribal agriculture in New Caledonia," Ecological Economics, Elsevier, vol. 182(C).
    21. Lederman, Daniel, 2002. "Income, wealth, and socialization in Argentina : provocative responses from individuals," Policy Research Working Paper Series 2821, The World Bank.
    22. Daniel Lederman, 2005. "Income Wealth, and Socialization in Argentina," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 42(125), pages 3-30.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ucp:ecdecc:y:2003:v:51:i:3:p:573-601. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Journals Division (email available below). General contact details of provider: https://www.journals.uchicago.edu/EDCC .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.