The Right Amount of Trust

Butler, Jeffrey V.; Giuliano, Paola; Guiso, Luigi

doi:10.2139/ssrn.1625677

Cited by 39 publications

(46 citation statements)

References 51 publications

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“…Trust is crucial to economic and political development (Arrow 1972;Putnam 1993;Whiteley 2000;Uslaner and Brown 2005;Karlan et al 2009;Tabellini 2010;Cahuc 2010, 2013;Butler et al 2016), and those heuristics that people use to determine whether or not to trust others and under which conditions to trust others clearly differ by society (Henrich et al 2001). There are also practical reasons social scientists have recently focused on trust: there are numerous measures of trust collected in survey data (Fisman and Khanna 1999;Zak and Knack 2001;Alesina and La Ferrara 2002;Bahry et al 2005;Hooghe et al 2009;Aghion et al 2010;Durante 2010;Nunn and Wantchekon 2011;Kasara 2013;Becker et al 2016); and trust experiments are among the most widely used in experimental studies, both in the lab and in the field (Berg et al 1995;Glaeser et al 2000;Fershtman and Gneezy 2001;Fehr et al 2002;Barr 2003;Karlan 2005;Sutter and Kocher 2007;Sapienza et al 2013;Robinson 2016).…”

Section: Introductionmentioning

confidence: 99%

“…Of particular relevance to the current paper is Algan and Cahuc (2013), who provide a nice review of the literature on trust and economic outcomes, and Nannestad (2008), who overviews the literature on generalized trust. sociological, or institutional determinants have included instrumental variables (Uslaner and Brown 2005;Tabellini 2010;Nunn and Wantchekon 2011), regression discontinuity Karaja 2013;Becker et al 2016;Buggle 2016), and laboratory or field experiments (Fershtman and Gneezy 2001;Cassar et al 2013;Adida et al 2016;Bigoni et al 2016;Butler et al 2016;Robinson 2016;Lowes et al 2017;Jeon et al 2017). 2 Yet, there are tradeoffs inherent in each of these approaches.…”

Section: Introductionmentioning

confidence: 99%

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The Cultural Transmission of Trust Norms: Evidence from a Lab in the Field on a Natural Experiment

Karaja

Rubin

2017

SSRN Journal

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We conduct trust games in three villages in a northeastern Romanian commune. From 1775-1919, these villages were arbitrarily assigned to opposite sides of the Austrian and Ottoman/Russian border despite being located seven kilometers apart. All three villages were ruled by outsiders to Romania, with Russian and Ottoman fiscal institutions being more rapacious. We conjecture that this history, combined with historical selective migration, contributed to a culture of trust of outsiders (relative to co-villagers) on the Austrian side of the border. Our design permits us to test this conjecture, and more generally, whether historically-derived cultural norms are transmitted intergenerationally. We find that participants on the Austrian side that also have family roots in the village are indeed more likely to trust outsiders but less likely to trust co-villagers.

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Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

The Cultural Transmission of Trust Norms: Evidence from a Lab in the Field on a Natural Experiment

Karaja

Rubin

2017

SSRN Journal

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“…As noted by Butler et al . (), this survey question (which is present also in the European Social Survey, and which they use in their paper) allows us to assess the intensity of an individual's trust beliefs, rather than simply whether an individual believes that most people can be trusted or not (as in most surveys containing the trust question).…”

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confidence: 99%

“… This picture is compatible with prior work on trust and social capital in Europe, which has shown that while Scandinavian countries are characterized by high levels of generalized trust, this is not the case for Mediterranean countries (e.g., Guiso et al ., ; Butler et al ., ), possibly because of the role played by so‐called amoral familism (Banfield, ). See Alesina and Giuliano () on the differences between northern and southern European countries with regard to the strength of family ties. …”

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confidence: 99%

Can Risk‐Averse Households Make Risky Investments? The Role of Trust in Others

Bucciol

Cavasso

Zarri

2018

Scandinavian J Economics

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In this paper, using data from the Survey on Health, Ageing and Retirement in Europe (SHARE, 2006 and 2013 waves), we illustrate the link between individuals' attitudes to financial risk combined with their willingness to trust others, and their investments in risky assets. Individuals who display either risk tolerance alone or -to a lesser extent -risk aversion and trust more frequently decide to buy risky assets. The comparison between Scandinavian and Mediterranean countries indicates that trust plays qualitatively different roles depending on the prevailing combination of risk attitude and trust in the area being studied.

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“…In this paper, we relate giving to trust in institutions (i.e., charity and government). For trust among individuals in a society, see Glaeser, Laibson, Scheinkman, and Soutter (), Alesina and La Ferrara (), and Butler, Guiso, and Giuliano ().…”

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confidence: 99%

Trust, ability‐to‐pay, and charitable giving

Ferrara

Missios

2019

J Public Economic Theory

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In the literature on privately provided public goods, altruism has been motivated by what contributions can accomplish (public goods philanthropy), by the pleasure of giving (warm-glow philanthropy), or by the desire to personally make a difference (impact philanthropy).Underlying these motives is the idea that individuals trust that their donations reach their goal. We revisit these models but allow for distrust in the institutional structuresinvolved. An important result we derive is that trust considerations determine whether crowding out is less or more than complete, and we thus open up possibilities in terms of the extent of crowding out not currently available.We also model socially motivated philanthropy when income-heterogeneous donors take trust and ability-to-pay into account. With ability-to-pay in social motivation, an important result we obtain is that low-income donors may contribute more than high-income donors (in both absolute and percentage-of-income terms), giving a potential theoretical foundation to the frequently observed "U-shaped" pattern of giving. 5 Administrative costs are just one piece of an individual's trust in a charity, but, other things equal, an individual is more likely to trust a charity with lower costs than a similar-goaled charity with high costs.FERRARA AND MISSIOS | 585

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The Right Amount of Trust

Cited by 39 publications

References 51 publications

The Cultural Transmission of Trust Norms: Evidence from a Lab in the Field on a Natural Experiment

The Cultural Transmission of Trust Norms: Evidence from a Lab in the Field on a Natural Experiment

Can Risk‐Averse Households Make Risky Investments? The Role of Trust in Others

Trust, ability‐to‐pay, and charitable giving

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