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Trust: A Concept Too Many

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  • Timothy W. Guinnane

    () (Economic Growth Center, Yale University)

Abstract

Research on "trust" now forms a prominent part of the research agenda in history and the social sciences. Although this research has generated useful insights, the idea of trust has been used so widely and loosely that it risks creating more confusion than clarity. This essay argues that to the extent that scholars have a clear idea of what trust actually means, the concept is, at least for economic questions, superfluous: the useful parts of the idea of trust are implicit in older notions of information and the ability to impose sanctions. I trust you in a transaction because of what I know about you, and because of what I can have done to you should you cheat me. This observation does not obviate what many scholars intend, which is to embed economic action within a framework that recognizes informal institutions and social ties. I illustrate the argument using three examples drawn from an area where trust has been seen as critical: credit for poor people.

Suggested Citation

  • Timothy W. Guinnane, 2005. "Trust: A Concept Too Many," Working Papers 907, Economic Growth Center, Yale University.
  • Handle: RePEc:egc:wpaper:907
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    File URL: http://www.econ.yale.edu/growth_pdf/cdp907.pdf
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    References listed on IDEAS

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    1. Williamson, Oliver E, 1993. "Calculativeness, Trust, and Economic Organization," Journal of Law and Economics, University of Chicago Press, vol. 36(1), pages 453-486, April.
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    Cited by:

    1. Christian Bjørnskov & Gert Svendsen, 2013. "Does social trust determine the size of the welfare state? Evidence using historical identification," Public Choice, Springer, vol. 157(1), pages 269-286, October.
    2. Alvin Etang Ndip & David Fielding & Stephen Knowles, 2007. "Survey Trust, Experimental Trust and ROSCA Membership in Rural Cameroon," Working Papers 0713, University of Otago, Department of Economics, revised Nov 2007.
    3. Marcus Noland, 2005. "Affinity and International Trade," Working Paper Series WP05-3, Peterson Institute for International Economics.
    4. Bjørnskov, Christian, 2006. "The Determinants of Trust," Ratio Working Papers 86, The Ratio Institute.
    5. Guillaume Daudin, 2006. "Paying Transaction Costs," Documents de Travail de l'OFCE 2006-14, Observatoire Francais des Conjonctures Economiques (OFCE).
    6. Wahl, Fabian, 2012. "Why it matters what people think: Beliefs, legal origins and the deep roots of trust," FZID Discussion Papers 52-2012, University of Hohenheim, Center for Research on Innovation and Services (FZID).
    7. Ann Owen & Julio Videras, 2009. "Reconsidering social capital: a latent class approach," Empirical Economics, Springer, vol. 37(3), pages 555-582, December.
    8. Christian Bjørnskov & Kim Sønderskov, 2013. "Is Social Capital a Good Concept?," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 114(3), pages 1225-1242, December.
    9. repec:eee:finlet:v:23:y:2017:i:c:p:80-86 is not listed on IDEAS
    10. Fenske, James, 2010. "Institutions in African history and development: A review essay," MPRA Paper 23120, University Library of Munich, Germany.
    11. Colvin, Christopher L., 2017. "Banking on a Religious Divide: Accounting for the Success of the Netherlands' Raiffeisen Cooperatives in the Crisis of the 1920s," The Journal of Economic History, Cambridge University Press, vol. 77(03), pages 866-919, September.
    12. repec:spo:wpecon:info:hdl:2441/942 is not listed on IDEAS
    13. Knowles, Stephen, 2006. "Is Social Capital Part of the Institutions Continuum and is it a Deep Determinant of Development?," WIDER Working Paper Series 025, World Institute for Development Economic Research (UNU-WIDER).
    14. Christopher L. Colvin & Eoin McLaughlin, 2014. "Raiffeisenism abroad: why did German cooperative banking fail in Ireland but prosper in the Netherlands?," Economic History Review, Economic History Society, vol. 67(2), pages 492-516, May.
    15. Becchetti, Leonardo & Conzo, Pierluigi, 2011. "Enhancing capabilities through credit access: Creditworthiness as a signal of trustworthiness under asymmetric information," Journal of Public Economics, Elsevier, vol. 95(3), pages 265-278.
    16. Ivana Catturani & Panu Kalmi & Maria Lucia Stefani, 2016. "Social Capital and Credit Cooperative Banks," Economic Notes, Banca Monte dei Paschi di Siena SpA, vol. 45(2), pages 205-234, July.
    17. Heidi Deneweth & Oscar Gelderblom & Joost Jonker, 2014. "Microfinance And The Decline Of Poverty: Evidence From The Nineteenth-Century Netherlands," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 39(1), pages 79-110, March.
    18. Fabien Eloire & Claire Lemercier & Veronica Aoki Santarosa, 2016. "Beyond the personal-anonymous divide: Agency relations in powers of attorney in France, 18th–19th centuries," Working Papers hal-01358365, HAL.
    19. Fabien Eloire & Claire Lemercier & Veronica Aoki Santarosa, 2016. "Beyond the personal-anonymous divide: Agency relations in powers of attorney in France, 18th–19th centuries," Sciences Po publications info:hdl:2441/3v5ra0iula8, Sciences Po.

    More about this item

    Keywords

    Trust; Social Capital; Credit Cooperatives; Uniform Laws;

    JEL classification:

    • G2 - Financial Economics - - Financial Institutions and Services
    • N2 - Economic History - - Financial Markets and Institutions

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