Do Welfare Programs Damage Interpersonal Trust?: Experimental Evidence from Representative Samples for Four Latin American Cities

This paper argues that welfare programs are linked with the destruction of social capital, as measured by interpersonal trust in laboratory games. The paper employs experimental data for representative samples of individuals in four Latin American capital cities (Bogota, Lima, Montevideo, and San Jose), finding that participation in welfare programs damage trust. This result is robust to the inclusion of individual risk measures and a broad array of controls. The findings also support the notion that low take-up rates may be due to stigma linked with trust and social capital, rather than transaction costs.

Bibliographic Details

Main Author:	Inter-American Development Bank
Other Authors:	Vanessa Ríos
Format:	Working Papers biblioteca
Language:	English
Published:	Inter-American Development Bank
Subjects:	Social Development, D01 - Microeconomic Behavior: Underlying Principles, O10 - Economic Development: General, O12 - Microeconomic Analyses of Economic Development, WP-668,
Online Access:	http://dx.doi.org/10.18235/0010904 https://publications.iadb.org/en/do-welfare-programs-damage-interpersonal-trust-experimental-evidence-representative-samples-four
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