Stalin and the Origins of Mistrust

43 Pages Posted: 21 May 2019

See all articles by Milena Nikolova

Milena Nikolova

IZA

Olga Popova

Leibniz Institute for East and Southeast European Studies (IOS); Charles University in Prague - CERGE-EI (Center for Economic Research and Graduate Education - Economics Institute); Graduate School of Economics and Management, Ural Federal University

Vladimir Otrachshenko

New University of Lisbon - Nova School of Business and Economics

Date Written: April 2019

Abstract

We show that current differences in trust levels within former Soviet Union countries can be traced back to the system of forced prison labor during Stalin's rule, which was marked by high incarceration rates, repression, and harsh punishments. We argue that those exposed to forced labor camps (gulags) became less trusting and transferred this social norm to their descendants. Combining contemporary individual-level survey data with historical information on the location of forced labor camps, we find that individuals who live near former gulags have low levels of social and institutional trust. Our results are robust to a battery of sensitivity checks, which suggests that the relationship we document is causal. We outline several causal mechanisms and test whether the social norm of mistrust near gulags developed because of political repression or due to fear that inmates bring criminality. As such, we provide novel evidence on the channels through which history matters for current socio-economic outcomes today.

Keywords: social trust, institutional trust, trustworthiness, forced labor, economic history, former Soviet Union

JEL Classification: D02, H10, N94, Z13

Suggested Citation

Nikolova, Milena and Popova, Olga and Otrachshenko, Vladimir, Stalin and the Origins of Mistrust (April 2019). IZA Discussion Paper No. 12326, Available at SSRN: https://ssrn.com/abstract=3390315

Olga Popova

Leibniz Institute for East and Southeast European Studies (IOS) ( email )

Landshuter Str. 4
Regensburg, 93047
Germany

Charles University in Prague - CERGE-EI (Center for Economic Research and Graduate Education - Economics Institute) ( email )

P.O. Box 882
7 Politickych veznu
Prague 1, 111 21
Czech Republic

HOME PAGE: http://www.cerge-ei.cz

Graduate School of Economics and Management, Ural Federal University ( email )

Yekaterinburg
Russia

Vladimir Otrachshenko

New University of Lisbon - Nova School of Business and Economics ( email )

Campus de Campolide
Lisbon, 1099-032
Portugal

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