Culture, caution, and trust

• 成果类型: Article
• 署名作者: Breuer, Janice Boucher; McDermott, John
• 署名单位: University of South Carolina System; University of South Carolina Columbia
• 刊物名称: JOURNAL OF DEVELOPMENT ECONOMICS
• ISSN/ISSBN: 0304-3878
• DOI: 10.1016/j.jdeveco.2011.02.001
• 发表日期: 2012
• 页码: 15-23
• 关键词: trust; RISK; Caution; culture; trustworthiness

摘要

Trust is an important determinant of economic development. Understanding its origins is therefore critical. We develop a principal-agent model with heterogeneous players to determine the aggregate amount of trustworthiness and trust in a society. People are distributed according to their preference toward caution, which we model as loss aversion. The first two moments of the distribution across principals and agents along with institutional quality are critical to the process by which trustworthiness and trust are formed. A direct effect suggests that more caution leads to less societal trust. An indirect effect of greater caution, working through trustworthiness, leads to more trust. Paradoxically, the net effect is almost always positive. The results are similar when we use expected utility theory. Different distributional assumptions can influence the results. (C) 2011 Elsevier B.V. All rights reserved.