Social Capital Formation and Diversity: Impacts of Individual and Place-Related Characteristics

Using structural equation modelling, we assess the degree to which the characteristics of both individuals and the cities in which they live may affect scores on three domains underlying social capital-trust, interaction and membership. We find that diversity, as it relates to both the individual and the city of residence, affects social capital formation. However, the impact of diversity is not necessarily negative. As the proportion of visible minorities in a city increases, the average level of trust decreases, suggesting that, on this dimension at least, increased diversity can have a negative impact on this aspect of social capital formation. However, as contextual or city-level diversity increases, the level of participation in organisations and trust in others increases. This suggests that bridging social capital can increase as diversity increases.