Essays on social capital.

Summary Social capital consists of the values that lead people to cooperate and act with reciprocity and empathy in the absence of any formal control mechanism. Social capital manifests itself through trust, but also through opinions in favor of collective rather than individual responsibility for economic security. This thesis provides new answers to two fundamental questions in the literature. What are the consequences of value differences for economic activity? What determines the existence of such values? The first two chapters focus on the relationship between trust on the one hand and macroeconomic volatility and financial development on the other. The analysis shows that trust reduces economic volatility and promotes financial development both in space and time. The third documents a non-monotonic relationship between norms of cooperation and generosity of the welfare state. Generous welfare states can exist both in countries with high levels of trust and in those with low levels of trust if many citizens take undue advantage of the social insurance system. The question of the origin of values is addressed in the last two chapters. The fourth looks at the persistence of values associated with the myth of early mining in the United States: individual responsibility and opposition to public intervention. The final chapter looks at changes in trust in leaders and institutions in Africa following riots or demonstrations.