Historical Trust Levels Predict Current Welfare State Design
AbstractUsing cross-sectional data for 76 countries, we apply instrumental variable techniques based on pronoun drop, temperature and monarchies to demonstrate that historical trust levels predict several indicators of current welfare state design, including universalism and high levels of regulatory freedom. We argue that high levels of trust and trustworthiness are necessary, but not sufficient, conditions for societies to develop successful universal welfare states that would otherwise be highly vulnerable to free riding and fraudulent behavior. Our results do not exclude positive feedback from welfare state universalism to individual trust, although we claim that the important causal link runs from historically trust levels to current welfare state design.
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Bibliographic InfoPaper provided by The Ratio Institute in its series Ratio Working Papers with number 144.
Length: 28 pages
Date of creation: 29 Oct 2009
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Social trust; Welfare State;
Find related papers by JEL classification:
- Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Social and Economic Stratification
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-11-14 (All new papers)
- NEP-CBE-2009-11-14 (Cognitive & Behavioural Economics)
- NEP-SOC-2009-11-14 (Social Norms & Social Capital)
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