Cultivating Trust

Norms, Institutions and the Implications of Scale

Bibliographic Data

ID9706911
AuthorsChris Bidner (UNSW Sydney), Patrick Francois (0000-0003-3287-037X, University of British Columbia, Canadian Institute for Advanced Research and CEPR)
Year2011
Volume121
Issue555
Pages1097-1129
Publication date2011-09-01
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueThe Economic Journal (JOURNAL)
Journal identifiersISSN: 0013-0133 • E-ISSN: 1468-0297
PublisherOxford University Press (OUP) (PUBLISHER)
DOI10.1111/j.1468-0297.2010.02398.x
OpenAlexW1561066473
LanguageEN
Citations received17
References cited53

We study the co‐evolution of honesty norms and institutions. New trading opportunities require institutional changes to be realised, since the initial vulnerability of institutions to opportunistic behaviour leads to the deterioration of norms. We show how an escape from opportunism requires that institutional improvements outpace norm deterioration. A key prediction emerges: larger economies are more likely to evolve to steady states with strong honesty norms but need not have better institutions. This prediction is tested using a cross‐section of countries; population has a significant positive relationship with trust, even when controlling for standard trust determinants and institutional quality

Business · Economics · Geography · Honesty · Institutional economics · Market economy · Norm (philosophy · Opportunism · Political science · Population · Public economics · Quality (philosophy · Scale (ratio · Sociology · Vulnerability (computing · Culture, Economy, and Development Studies · Economic Policies and Impacts · Experimental Behavioral Economics Studies · Law

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