Slave trade, trust, and corruption

Abstract

ABSTRACT Theory predicts that societies with higher social capital have lower levels of government corruption. This hypothesis has been difficult to evaluate empirically because of widespread reliance on aggregated, country-level measures of trust and corruption, and reverse causality. We utilize micro-level international data from 34 African nations and two alternative measures of both trust and corruption to re-evaluate the evidence of this theorized relationship. To account for reverse causality, we use historical transatlantic slave exportation data as an instrumental variable. Slave trade has historically lowered interpersonal trust in Africa, which has had a long lasting effect on past and present levels of corruption. Our findings indicate that a higher level of personalized trust leads to more corruption, whereas a higher level of generalized trust leads to less corruption. This result is robust to alternative specifications of regression models, including different measures of trust and experienced versus perceived types of corruption.