Does social capital affect foreign aid allocations?

This paper explores the issue of whether countries with high levels of social capital give more foreign aid than others. It is often argued that in countries with high levels of social capital (as measured, for example, by trust, civic norms and membership of community groups) levels of cooperation and altruistic behaviour will be higher. This paper explores whether such altruistic behaviour extends to giving foreign aid. Cross-country data are used to assess whether countries with high levels of social capital give more foreign aid, as a proportion of GDP, than countries where social capital is lower.UnpublishedAlesina, A. and D. Dollar (2000) “Who gives foreign aid to whom and why?”, Journal of Economic Growth, 5, 33-63. Boone, P. (1996) “Politics and the effectiveness of foreign aid”, European Economic Review, 40, 289-329. Burnside, C. and D. Dollar (2000) “Aid, policies and growth”, American Economic Review, 90, 847-868. Glaeser, Edward L., David I. Laibson, José A. Scheinkman and Christine L. Soutter (2000) “Measuring trust,” Quarterly Journal of Economics 115, 811-846. Ingelhart, R. et al (2000), World Values Surveys and European Values Surveys, 1981-1984, 1990-1993, and 1995-1997, Ann Arbor, Michigan: Inter-University Consortium for Political and Social Research. Knack, S. and P. Keefer (1997) “Does social capital have an economic payoff?”, Quarterly Journal of Economics, 112, 1251-1288. McKinley, R.D. and R. Little (1979) “The US aid relationship: a test of the recipient need and the donor interest models”, Political Studies, 29, 236-250. Maizels, A. and M.K. Nissanke (1984) “Motivations for aid to developing countries”, World Development, 12, 879-900. Morrissey, O. (2001) “Does aid increase growth”, Progress in Development Studies, 1, 37-50. Putnam, R. (1993) Making Democracy Work, Princeton University Press, Princeton. Trumbull, W.N. and H.J. Wall (1994) “Estimating aid-allocation criteria with panel data”, Economic Journal, 104, 876-882. Whiteley, P.F. (2000) “Economic growth and social capital”, Political Studies, 48, 443-466. World Bank (1997) World Development Indicators, World Bank, Washington. Zak, P.J. and S. Knack (2001) “Trust and growth”, Economic Journal 111, 295-321