The Quality of Government and Social Capital: A Theory of Political Institutions and Generalized Trust

Abstract

The purpose of this article is to present a new theory on the generation of social capital. In the discussion about the sources of social capital it has been stressed that generalized trust is built up by the citizens themselves through a culture that permeates the networks and organizations of civil society. Since this approach lacks a micro-theory and has produced only mixed empirical evidence, we like to highlight instead how social capital is embedded in and linked to formal political and legal institutions. Not all political institutions matter equally, however, in fact we argue that trust thrives most in societies with effective, impartial and fair street-level bureaucracies. The article presents the causal mechanism between these institutional characteristics and generalized trust, and illustrates its validity in a cross-national context.