Social Capital Formation across Space: Proximity and Trust in European Regions

An extensive economics and regional science literature has discussed the importance of social capital for economic growth and development. Yet, what social capital is and how it is formed are elusive issues, which require further investigation. Here, we refer to social capital in terms of civic capital and good culture, as rephrased by Guiso, Sapienza, and Zingales and Tabellini. The accumulation of this kind of capital allows the emerging of regional informal institutions, which may help explaining differences in regional development. In this article, we take a regional perspective and use exploratory space and space-time methods to assess whether geography, via proximity, contributes to the formation of social capital across European regions. In particular, we investigate whether generalized trust, a fundamental constituent of civic capital and an ingredient of economic development, tends to be clustered in space and over time. From the policy standpoint, the spatial path dependence of regional trust may contribute to the formation of spatial traps of social capital and act as a further barrier to regional economic development and convergence.