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Trust, Growth and Well-being: New Evidence and Policy Implications

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  • Algan, Yann

    ()
    (Sciences Po, Paris)

  • Cahuc, Pierre

    ()
    (Ecole Polytechnique, Paris)

Abstract

This survey reviews the recent research on trust, institutions and growth. It discusses the various measures of trust and documents the substantial heterogeneity of trust across space and time. The conceptual mechanisms and the methods employed to identify the causal impact of trust on economic performance are reviewed. We document the mechanisms of interactions between trust and economic development in the realms of finance, innovation, the organization of firms, the labor market and the product market. The last part reviews recent progress to identify how institutions and policies can affect trust and well-being.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 7464.

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Length: 88 pages
Date of creation: Jun 2013
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Handle: RePEc:iza:izadps:dp7464

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Keywords: institutions; growth; trust; well-being;

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Cited by:
  1. Byung-Yeon Kim & Syngjoo Choi & Jungmin Lee & Sokbae 'Simon' Lee & Kyunghui Choi, 2013. "Do institutions affect social preferences? Evidence from divided Korea," CeMMAP working papers, Centre for Microdata Methods and Practice, Institute for Fiscal Studies CWP35/13, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
  2. Pitlik, Hans & Kouba, Ludek, 2014. "Does social distrust always lead to a stronger support for government intervention?," Ratio Working Papers, The Ratio Institute 227, The Ratio Institute.

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