Harvard professor Robert Putnam has claimed that his studies show that ethnic diversity lowers trust in the community. The Financial Times claims that Prof Putnam told them that in “in the presence of diversity, we hunker down. We act like turtles. The effect of diversity is worse than had been imagined. And it’s not just that we don’t trust people who are not like us. In diverse communities, we don’t trust people who do look like us.”
Prof Putnam found trust was lowest in Los Angeles, “the most diverse human habitation in human history”, but his findings also held for rural South Dakota, where “diversity means inviting Swedes to a Norwegians’ picnic”. When the data were adjusted for class, income and other factors, they showed that the more people of different races lived in the same community, the greater the loss of trust. “They don’t trust the local mayor, they don’t trust the local paper, they don’t trust other people and they don’t trust institutions,” said Prof Putnam. “The only thing there’s more of is protest marches and TV watching.”
There is an interesting NBER working paper by Messers Glaeser, Alesina, and Sacerdote, Why Doesn't the US Have a European-Style Welfare System?, which traces it to racial heterogenity and ethnic diversity. They write, "Racial animosity in the US makes redistribution to the poor, who are disproportionately black, unappealing to many voters. American political institutions limited the growth of a socialist party, and more generally limited the political power of the poor."
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