Much research has established reliable cross-population differences in motivations to invest in one's in-group. We compare two current historical-evolutionary hypotheses for this variation based on (1) effective large-scale institutions and (2) pathogen threats by analyzing cross-national differences (N = 122) in in-group preferences measured in three ways. We find that the effectiveness of government institutions correlates with favoring in-group members, even when controlling for pathogen stress and world region, assessing reverse causality, and providing a check on endogeneity with an instrumental variable analysis. Conversely, pathogen stress shows inconsistent associations with in-group favoritism when controlling for government effectiveness. Moreover, pathogen stress shows little to no association with in-group favoritism within major world regions whereas government effectiveness does. These results suggest that variation in in-group preferences across contemporary nation-states is more consistent with a generalized response to institutions that meet basic needs rather than an evolved response dedicated to pathogens.