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Trust and the Welfare State: The Twin Peaks Curve

Author

Listed:
  • Yann Algan

    () (Département d'économie, Sciences Po - Sciences Po)

  • Pierre Cahuc

    (Department of Economics, Ecole Polytechnique - X - École polytechnique - CNRS - Centre National de la Recherche Scientifique, CREST - Centre de Recherche en Économie et Statistique - ENSAI - Ecole Nationale de la Statistique et de l'Analyse de l'Information [Bruz] - X - École polytechnique - ENSAE ParisTech - École Nationale de la Statistique et de l'Administration Économique)

  • Marc Sangnier

    () (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - ECM - Ecole Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique - AMU - Aix Marseille Université - EHESS - École des hautes études en sciences sociales)

Abstract

We show the existence of a twin peaks relation between trust and the size of the welfare state that stems from two opposing forces. Uncivic people support large welfare states because they expect to benefit from them without bearing their costs. But civic individuals support generous benefits and high taxes only when they are surrounded by trustworthy individuals. We provide empirical evidence for these behaviors and this twin peaks relation in the OECD countries.

Suggested Citation

  • Yann Algan & Pierre Cahuc & Marc Sangnier, 2014. "Trust and the Welfare State: The Twin Peaks Curve," Working Papers halshs-01000117, HAL.
  • Handle: RePEc:hal:wpaper:halshs-01000117
    Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-01000117
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    References listed on IDEAS

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    More about this item

    Keywords

    welfare state; trust; civism; corruption; redistribution;

    JEL classification:

    • H1 - Public Economics - - Structure and Scope of Government
    • Z1 - Other Special Topics - - Cultural Economics

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