Social Capital and Public Goods

Previous literature suggests positive relationships between social capital, pro-social behavior and subsequent economic development. We analyze the relationship between social networks and trust (two measures of social capital) and self-reported charitable contributions of time and/or money (pro-social behavior) using data collected from two ethnically distinct, low-income neighborhoods. We find that large social networks are positively related to charitable contributions, but that the effects of trust are less robust.We also find that social networks that are more geographically dispersed tend to be larger. Our results indicate that the social capital in a neighborhood is more important than ethnicity, ethnic diversity, or other demographic information in understanding public goods contributions