A Quantitative Analysis of Social Capital in Mexico

Social capital has been related to efiiciency in markets (Arrow, 1972), contract reinforcement (Durlauf and Fafchamps, 2004) and in general to development and welfare (Keefer and Knack 1997; Putnam 2000; Knack and Zak 2003). In this paper we empirically investigate the determinants of social capital, focusing on three common approximate measures of it: two related to trust, and one related to social organisation memberships. Using data for urban areas in Mexico for the year 2006, we find that social capital measured as trust and membership increases with age, and with the perception of higher levels of social capital in the environment; it also tends to be higher in smaller communities, and is different across regions of the country. On the other hand, social capital measured as trust decreases with segregation, while social capital measured as membership increases with education and income, but decreases with the lack of social security.