DP15259 Golfing with Trump. Social capital, decline, inequality, and the rise of populism in the US

Author(s): Neil Lee, Cornelius Lipp, Andrés Rodríguez-Pose
Publication Date: September 2020
Keyword(s): Counties, Donald Trump, economic and demographic decline, inequality, populism, social capital, US
JEL(s): D31, D72, O15, R11
Programme Areas: International Trade and Regional Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=15259

In 2000 Robert Putnam forecast that United States (US) democracy was at risk from the twin challenges of declining civic engagement and rising interpersonal inequality. Sixteen years later, his predictions were vindicated by the election of Donald Trump as president of the US. This paper analyses the extent to which the election of Donald Trump was related to levels of social capital and interpersonal inequalities and posits a third alternative: that the rise in vote for Trump in 2016 was the result of long-term economic and population decline in areas with strong social capital. This hypothesis is confirmed by the econometric analysis conducted for counties across the US. Long-term declines in employment and population â?? rather than in earnings, salaries, or wages â?? in places with relatively strong social capital propelled Donald Trump to the presidency. By contrast, low social capital and high interpersonal inequality were not connected to a surge in support for Trump. These results are robust to the introduction of control variables and different inequality measures. The analysis also shows that the discontent at the base of the Trump margin is not just a consequence of the 2008 crisis but had been brewing for a long time. Places in the US that remained cohesive but witnessed an enduring decline are no longer bowling alone, they are golfing with Trump.