Mind the Gap! Social Capital, East and West
40 Pages Posted: 24 Jan 2008
Date Written: June 2007
Recent Eurobarometer survey data are used to document and explain the stock of social capital in 28 European countries. Social capital in Central and Eastern Europe - measured by civic participation and access to social networks - lags behind that in Western European countries. Using regression analysis of determinants of individual stock of social capital, we find that this gap persists when we account for individual characteristics and endowments of respondents but disappears completely after we control for aggregate measures of economic development and quality of institutions. Informal institutions such as prevalence of corruption in post-communist countries appear particularly important. With the enlargement of the European Union, the gap in social capital should gradually disappear as the new member states catch up (economically and institutionally) with the old ones.
Keywords: social capital, institutions, capitalism, transition
JEL Classification: Z13, P37, O57, O17
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