Even in divided societies, people from different ethnic backgrounds engage each other and an overwhelming majority of this cross-ethnic interaction does not yield conflict, but rather cooperation. Whereas the literature focuses on ethnic diversity as an impediment to cooperation, this study aims to test whether social networks can overcome the challenges posed by ethnic diversity in collective action. This paper’s contribution is to examine the impact of social ties vis-à-vis ethnic difference on cooperative behavior. I analyze data collected from surveys and behavioral economics experimental play of 188 rural Malawians. I find ethnic difference (or sameness) does not influence whether subjects choose to trust their game partner but being socially connected to a game partner increases the odds that a subject will cooperate.
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