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Does social trust determine the size of the welfare state? Evidence using historical identification

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  • Christian Bjørnskov
  • Gert Svendsen

Abstract

Most modern welfare states offer an extensive array of services and benefits that are wholly or partly financed by tax revenue. One missing link in explaining the long-run sustainability of such comprehensive welfare states could be the already-existing stock of trust. Indeed, our cross-country results suggest that trust determines the size of welfare states as well as three features that are arguably necessary for their preservation: high levels of political confidence, strong legal institutions protecting private property rights, and low levels of bureaucratic corruption. Copyright Springer Science+Business Media, LLC 2013

Suggested Citation

  • Christian Bjørnskov & Gert Svendsen, 2013. "Does social trust determine the size of the welfare state? Evidence using historical identification," Public Choice, Springer, vol. 157(1), pages 269-286, October.
    • Handle: RePEc:kap:pubcho:v:157:y:2013:i:1:p:269-286
    DOI: 10.1007/s11127-012-9944-x
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    References listed on IDEAS

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