Type
Article
Title
Effect of Income on Trust: Evidence from the 2009 Economic Crisis in Russia
In
Economic Journal
Author(s)
ANANIEV Maxim - University of California Los Angeles (Author)
GURIEV Sergei - Département d'économie (Author)
Editor
GB : Wiley
Volume
129
Number
619
Pages
1082 - 1118 p.
ISSN
00130133
Keywords
Social Capital, Trust, Business Cycle
Abstract
EN
This article draws on a natural experiment to identify the relationship between income and trust. We use a unique panel data set on Russia where GDP experienced an 8% drop in 2009. The effect of the crisis had been uneven among Russian regions because of their differences in industrial structure inherited from the Soviet period. After instrumenting average regional income by Soviet industrial structure, we find that 10% decrease in income is associated with a five percentage point decrease in social trust. We also find that post-crisis economic recovery did not fully restore pre-crisis trust level.

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