Determinants of Social Capital: New Evidence on Religion, Diversity and Structural Change

Abstract

Americans not only bowl less today than they did fifty years ago, but also some bowl more than others. This is one of the major and simple messages of Robert Putnam's influential study of social capital in America. Using a variety of data sources, Putnam documents a significant variation in the states' levels of social capital, while arguing for specific general causes of the decline of social capital across the United States. Here, we evaluate the power of Putnam's theory in explaining state-level variation of stocks of social capital. We find that the strongest determinants of social capital levels are basic social and economic differences between states, such as education, church membership, farming and unemployment. Controlling for these determinants, we also find no evidence for a much-debated link between diversity and social capital.

Since the publication of Putnam's book, a growing quantitative literature on social capital has contributed to a much more nuanced and theoretically precise understanding of the link between social capital and the quality of American democracy. Pamela Paxton, as well as Dora Costa and Matthew Kahn, have re-examined Putnam's finding of the aggregate decline in social capital in the United States since the 1960s. Putnam's claim that higher levels of social capital improve the functioning of democracy on the state level has been examined systematically by, among others, Stephen Knack and Tom W. Rice. On a methodological level, Eric M. Uslaner has argued for a need to disaggregate different concepts of trust, and focus on generalized social trust and its effect on making democracy more effective.