Social trust, workplace organization, and the comparative advantage of nations

André van Hoorn

MPRA Paper from University Library of Munich, Germany

Abstract: In this paper, I consider a specific channel through which trust between parties to an exchange can go on to affect nations’ comparative advantage in certain industries. My approach revolves around the autonomy that employers (principals) grant to workers (agents), which is a key feature of workplace organization. I hypothesize that social trust generates a comparative advantage in industries with more autonomous micro production environments. I employ individual-level data on work autonomy to construct a measure of the extent to which industries are characterized by autonomy in the production process. Results of a cross-country cross-industry analysis confirm that countries with higher levels of social trust have a comparative advantage in high-autonomy industries and vice versa. Results are robust to the possibility of reverse causality. The paper’s key contribution is to provide a link between the microeconomic literature on workplace organization and the comparative macroeconomic literature on social trust.

Keywords: Social capital; work autonomy; comparative economic development; division of labor; comparative advantage; organizational design; culture (search for similar items in EconPapers)
JEL-codes: D23 L23 M54 O43 O57 P50 Z10 (search for similar items in EconPapers)
Date: 2017
New Economics Papers: this item is included in nep-hrm and nep-soc
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:80017

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