Does Economic Prosperity Breed Trust?

Mark Gradstein and Alberto Chong
Authors registered in the RePEc Author Service: Markus Brueckner

No 10749, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: We explore whether national economic prosperity enhances mutual generalized trust. This is done using panel data of multiple waves of the World Values Surveys, whereby national income levels are instrumented for using exogenous oil price shocks. We find significant and substantial effects of national income on the level of trust in the economy. In particular, a one percent increase in national income tends to cause an average increase of one percentage point (or more) in the likelihood that a person becomes trustful. One possible rationalization for this, exhibited in a simple model, is that perceived prosperity signals that many people are trustworthy.

Keywords: Generalized trust; National income; Oil price shocks (search for similar items in EconPapers)
JEL-codes: O10 P17 (search for similar items in EconPapers)
Date: 2015-08
New Economics Papers: this item is included in nep-soc
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://cepr.org/publications/DP10749 (application/pdf)

Related works:
Working Paper: DOES ECONOMIC PROSPERITY BREED TRUST? (2015)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:10749

Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP10749

Access Statistics for this paper

More papers in CEPR Discussion Papers from Centre for Economic Policy Research 33 Great Sutton Street, London EC1V 0DX, UK.
Bibliographic data for series maintained by CEPR ().