Location of Cities, Ruggedness of Terrain, and the Social Trust of Residents: Evidence from China.

This paper discusses how geographic features affect the level of social trust in a region. Using individual-level survey data from China with more than 40,000 observations, the authors find that social trust is higher in cities that are located at the border of provinces. The ruggedness of the traffic route between the city and the capital city of the province is added to the empirical model as an instrumental variable for further analysis. This solves the measurement error and the omitted variables problems in the baseline empirical model. Results of the two-stage least least-squares estimation show that the level of average social trust is still higher in the border cities. The mechanism explaining the empirical results is that the population in China has tended to migrate from the border cities to nonborder cities. This leads to residents in the nonborder cities having multiple cultures, which increases the probability of misperception in the coordination of daily life. Consequently, misperception among groups with different cultures lowers the level of social trust in the nonborder city. [ABSTRACT FROM AUTHOR]