Social trust and fractionalization: A possible reinterpretation

This paper takes a closer look at the importance of fractionalization for the creation of social trust. It first argues that the determinants of trust can be divided into two categories: those affecting individuals trust radii and those affecting social polarization. A series of estimates using a much larger country sample than in previous literature confirms that fractionalization in the form of income inequality and political diversity adversely affects social trust while ethnic diversity does not. However, these effects differ systematically across countries, questioning standard interpretations of the influence of fractionalization on trust.