National Identification and Interpersonal Trust in Diverse Societies

Previous work has suggested that low levels of trust in ethnically diverse societies may be one mechanism explaining the negative relationship between diversity and economic growth. Building on theories developed in social psychology, I argue that increased national identification in such societies may reduce the negative effects of ethnic diversity on interpersonal trust by extending trust across ethnic lines. Based on analyses of original survey data collected in a border region of Malawi and Zambia, results suggest that degree of national identification is positively related to trust in conationals, even across ethnic lines. However, non-coethnics are trusted at rates similar to coethnics only among individuals that identify strongly with the nation and weakly with their ethnic group. Thus, the evidence suggests that increased national identification alone is not enough to reduce the coethnic trust premium. National Identification and Trust 1 It is taken as common wisdom among scholars and laymen alike that many of the political and economic problems of post-colonial states can be attributed to the lack of a unifying national identity. In Africa, the arbitrary division of the continent by colonial powers produced ethnically diverse countries, making the emergence of a unifying national identity difficult. As a consequence of this ethnic diversity, scholars have argued that low levels of trust and cooperation have hampered economic growth (Easterly and Levine, 1997; Alesina and La Ferrara, 2005; Englebert, 2002) and ethnic bloc-voting and ethnic favoritism have perverted democratic institutions (Horowitz, 1985; Neuberger, 2000; Chandra, 2004). The presumption is that a common national identity shared by individuals within these countries could ameliorate the negative consequences of ethnic diversity. However, this presumption has yet to be rigorously tested. The work presented in this paper addresses the effects of national identification on one important micro-foundation of economic development – interpersonal trust. Previous work has identified the low levels of generalized trust within ethnically diverse societies as a mechanism explaining the negative relationship between ethnic diversity and economic growth. Building on the Common In-group Identity Model developed in social psychology (Gairtner and Dividio, 2000), I argue that increased identification with the overarching national identity within ethnically diverse African societies may reduce the negative effects of ethnic diversity on interpersonal trust. The empirical results presented come from two sources. The first are public opinion data collected by Afrobarometer in sixteen African countries. I analyze the effect of national identification on interpersonal trust at the individual level and find that national identification relative to ethnic identification is positively related to both generalized interpersonal trust and to trust in non-coethnics vis-a-vis coethnics. The second source of data comes from original survey data I collected in an ethnically diverse border region of Malawi and Zambia in the fall of 2010, which measures national and ethnic identification separately. I find evidence that the degree of identification with the national (ethnic) group is positively related to amount of additional trust held in strangers based on shared nationality (ethnicity). However, I do not find statistically significant effects of the strength of national identification on the degree to which non-coethnics within the same national group are trusted relative to coethnics, once strength of ethnic identification is controlled for. Building on results from these two data sources, and the lessons learned during preliminary fieldwork, the last section of the paper outlines National Identification and Trust 2 my plans for collecting additional data in Malawi. Ethnic Diversity and Interpersonal Trust A growing literature in economics, beginning with a seminal paper by Easterly and Levine (1997), has identified a robustly negative relationship between ethnic diversity and economic growth around the world (see Alesina and Ferrara (2005) for a review). One of the mechanisms suggested to account for this relationship works through generalized trust. First suggested by Zak and Knack (2001), the argument is that low levels of generalized interpersonal trust inhibit economic growth, and that low trust is typically found in ethnically diverse societies. This argument implies two separate relationships: first, between trust and growth and, second, between ethnic diversity and trust. Trust and Economic Growth Early work on the role of social capital on economic development focused on social capital as an umbrella category. For example, in the famous book explaining differential development between northern and southern Italy, Putnam (1993) defines social capital as encompassing trust in other members of society, cooperative social norms, and active civic engagement. However, the cross-national empirical analyses that followed Putnam have focused almost exclusively on generalized trust. The two most prominent papers that connect trust to economic performance are Knack and Keefer (1997) and Zak and Knack (2001). Both papers use World Values Survey data to measure trust, using the standard question: “Generally speaking, would you say that most people can be trusted, or that you cannot be too careful in dealing with people?” At the country level, these authors find that the percentage of respondents that say “most people can be trusted” is positively related to economic growth, controlling for the standard factors that predict economic performance. The identified effects are quite large – a one standard deviation increase in trust (15 percentage points) increases growth in GDP per capita by one percentage point (Zak and Knack, 2001). Other studies using a similar framework find comparable effect sizes (Whiteley, 2000; Beugelsdijk et al., 2004). The mechanism generally suggested to account for this effect is that societies with high levels of generalized trust are able to achieve higher ecoNational Identification and Trust 3 nomic growth due to lower transaction costs (Zak and Knack, 2001; Whiteley, 2000). As Arrow (1972) has noted, “virtually every commercial transaction has within itself an element of trust.” Where such trust is lacking, individuals must invest in additional information or contracting, diverting resources away from production. Thus,Zak and Knack (2001) argue that when trust is sufficiently low there is too little investment to make economic growth possible. Ethnic Diversity and Trust If generalized interpersonal trust is such an important requisite for economic growth, it is important to identify its determinants. Empirical work using the same survey data on generalized trust discussed above finds evidence that good government, wealth, income inequality, and Protestantism are all positively related to average levels of generalized trust (Zak and Knack, 2001; Delhey and Newton, 2005). But perhaps one of the most robust predictors of generalized trust across countries is the ethnic make-up of the country (Zak and Knack, 2001; Delhey and Newton, 2005; Hooghe et al., 2009). As Whiteley (2000) cogently puts it, “some societies, particularly those deeply divided by ethnic or racial divisions, may have strong ties and high levels of ‘thick’ trust within particular communities, but this does not generalize to society as a whole.” Why does ethnic diversity reduce trust? Two possibilities have been suggested. First, it may be that individuals in all societies tend to trust coethnics more than non-coethnics, and because there are more non-coethnics in diverse societies, overall levels of generalized trust are depressed. In line with this explanation, Zak and Knack (2001) suggest that trust is lower in diverse societies because individuals possess an innate (biological) desire to protect one’s own extended family, through the mechanism of kin altruism. Thus, in all societies, individuals trust those from a similar ethnic background more than those of different ethnicities. In homogenous societies, there are high levels of generalized trust because everyone is ethnically similar. In contrast, in ethnically diverse societies, individuals may greatly trust their coethnics, but ‘most people’ would include a lot of non-coethnics whom the individual does not trust. The second possibility is that diversity has more than just a compositional effect – it may make ethnic differences more relevant for who is to be trusted. For example, scholars have long had the intuition that ethnic diversity was National Identification and Trust 4 somehow related to the salience of ethnic differences (Horowitz, 1985). In particular, it has been argued that the salience of ethnic group differences should be maximized when there are a few, equally sized ethnic groups than when there is only one large ethnic group or many small ethnic groups, and, thus, measures of ‘ethnic polarization’ have been developed in order to capture this intuition (Montalvo and Reynal-Querol, 2005a,b; Dincer, 2011). In terms of trust, then, we would expect that inter-group trust would decrease (and that within-group trust would increase) as ethnic salience increased. This is ultimately an empirical question. The first explanation would predict that trust would have a negative linear relationship with generalized trust. In contrast, the second explanation would predict that generalized trust would have a non-monotonic relationship with ethnic diversity and would have a negative linear relationship with ethnic polarization. Existing evidence seems to support the latter explanation. Zak and Knack (2001) and Dincer (2011) find that ethnic diversity has a negative effect on trust at low levels of ethnic diversity, but that the relationship becomes positive at higher levels of diversity. Similarly, Dincer (2011) also finds a significant negative relationship between ethnic polarization and generalized trust. These results suggest that ethnic make-up is related to generalized trust because certain ethnic compositions make ethnic differences more salient. The obvious next question is why the salience of ethnic differences are related to trust. Social identity theory (SIT), a guiding theory in social psychology, would suggest that increased salience of ethnic group differences increase the likelihood that individuals classify members of in-groups and out-groups based on ethnic membership (Tajfel et al., 1971). Relevant to the topic at hand, one benefit that in-group members consistently enjoy over out-group members is greater perceptions of trustworthiness by other in-group members (Brewer and Kramer, 1985; Kramer and Brewer, 2006). Thus, in short, the existing literature suggests that ethnic polarization should be negatively related to generalized trust (and, in turn, economic growth) because individuals in polarized societies tend to define in-groups and out-groups on the bases of ethnicity. As a result, trust does not extend beyond ethnic lines. National Identification and Trust 5 Extending Trust Through National Identifica-