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How Does Social Trust Affect Economic Growth?

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Author Info
Bjørnskov, Christian () (Department of Economics, Aarhus School of Business)

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Abstract

This paper connects two strands of the literature on social trust by estimating the effects of trust on growth through a set of potential transmission mechanisms directly. It does so by modelling the process using a three-stage least squares estimator on a sample of countries for which a full data set is available. The results indicate that trust affects schooling and the rule of law directly. These variables in turn affect the investment rate (schooling) and provide a direct effect (rule of law) on the growth rate. The paper closes with a short discussion of the relevance of the findings.

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File URL: http://www.hha.dk/nat/wper/06-2_CB.pdf
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Publisher Info
Paper provided by University of Aarhus, Aarhus School of Business, Department of Economics in its series Working Papers with number 06-2.

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Length: 44 pages
Date of creation: 04 May 2006
Date of revision:
Handle: RePEc:hhs:aareco:2006_002

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Postal: The Aarhus School of Business, Prismet, Silkeborgvej 2, DK 8000 Aarhus C, Denmark
Phone: +45 89 486396
Fax: +45 8615 5175
Web page: http://www.asb.dk/departments/nat.aspx
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Related research
Keywords: Growth; Trust; Transmission mechanisms;

Find related papers by JEL classification:
N40 - Economic History - - Government, War, Law, and Regulation - - - General, International, or Comparative
O10 - Economic Development, Technological Change, and Growth - - Economic Development - - - General
Z13 - Other Special Topics - - Cultural Economics - - - Social Norms and Social Capital; Social Networks Economic Anthropology

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Temple, Jonathan R. W., 2001. "Generalizations that aren't? Evidence on education and growth," European Economic Review, Elsevier, vol. 45(4-6), pages 905-918, May. [Downloadable!] (restricted)
  2. Wacziarg, Romain, 1998. "Measuring the dynamic gains from trade," Policy Research Working Paper Series 2001, The World Bank. [Downloadable!]
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  3. Greif, Avner, 1994. "On the Political Foundations of the Late Medieval Commercial Revolution: Genoa During the Twelfth and Thirteenth Centuries," The Journal of Economic History, Cambridge University Press, vol. 54(02), pages 271-287, June. [Downloadable!]
  4. Weede, Erich & Kampf, Sebastian, 2002. "The Impact of Intelligence and Institutional Improvements on Economic Growth," Kyklos, Blackwell Publishing, vol. 55(3), pages 361-80.
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Thomas Farole & Andrés Rodríguez-Pose & Michael Storper, 2007. "Social capital, rules, and institutions: A cross-country investigation," Working Papers 2007-12, Instituto Madrileño de Estudios Avanzados (IMDEA) Ciencias Sociales. [Downloadable!]
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