Does Trust Promote Growth?

Arbeitspapier

We examine the effect of generalized trust on long-term economic growth. Unlike in previous studies, we use Bayesian model averaging to deal rigorously with model uncertainty and attendant omitted variable bias. In addition, we address endogeneity and assess whether the effect of trust on growth is causal. Examining more than forty regressors for nearly fifty countries, we show that trust exerts a positive effect on long-term growth and, based on the posterior inclusion probabilities, suggest that trust is an important driver of long-term growth. Our results also show that trust is key for growth in countries with a weak rule of law.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IOS Working Papers ; No. 319

Classification and Topics

• Classification: Wirtschaft ; Institutions and Growth ; Economic Development: General ; Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification
• Subject: trust ; economic growth ; Bayesian model averaging ; Vertrauen ; Wirtschaftswachstum ; Schätzung ; Welt

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Horváth, Roman
• Event: Veröffentlichung
• (who): Institut für Ost- und Südosteuropaforschung (IOS)
• (where): Regensburg
• (when): 2012

Further information

• Handle: http://hdl.handle.net/10419/79226
• URN: urn:nbn:de:101:1-201207106486
• Last update: 10.03.2025, 11:44 AM CET