Social Capital in Transition: A First Look at the Evidence

Abstract

This paper provides what we believe to be the first collection of data on social capital in the transition countries of Central/Eastern Europe & of the former Soviet Union. Using data from the World Values Survey 1990 & 1995 we document the degree of trust & of civic participation & find that these indicators of social capital are significantly lower than in OECD countries. The paper also provides a preliminary investigation of the link between social capital & growth during transition. Unlike in market economies, in transition countries trust is not positively related to growth; while participation in civic organizations shows a positive correlation. We also construct indicators of trust in public institutions & find positive correlations with growth rates. The positive association of civic participation with growth is robust to the use of instrumental variable techniques to control for potential problems of endogeneity.