TY  - RPRT
        AU  - Mendolia, Silvia
AU  - Tosh, Alex
AU  - Yerokhin, Oleg
        TI  - Ethnic Diversity and Trust: New Evidence from Australian Data
        PY  - 2015/Dec/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 9544
        UR  - https://www.iza.org/publications/dp9544
        AB  - This paper investigates the relationship between neighbourhood ethnic and linguistic heterogeneity and the formation of an individual's local and general trust. A wide literature across economics and sociology has recognised the importance of trust in facilitating economic growth and development and it is therefore important to investigate elements of social organisation that encourage or inhibit the development of trust. We use fixed effects and instrumental variable regression and control for a wide set of individual and local area characteristics to identify the effect of heterogeneity on trust formation. Our results show that increasing neighbourhood ethnic and linguistic fractionalisation is associated with a decrease in local trust of about 12% of a standard deviation in the model with fixed effects, while we do not find any significant relationship between neighbourhood heterogeneity and general trust.
        KW  - trust
KW  - social capital
KW  - ethnic fractionalization
KW  - ethnic heterogeneity
KW  - HILDA
        ER  -