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National Income and Trust

Author

Listed:
  • Markus Brückner

    (Australian National University, Australia)

  • Alberto Chong

    (Department of Economics, Georgia State University, USA)

  • Mark Gradstein

    (Ben Gurion University, Israel)

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. We also identify crime and corruption as potential mechanisms that may lead to the reported causal effect and explore heterogeneous effects across individuals.

Suggested Citation

  • Markus Brückner & Alberto Chong & Mark Gradstein, 2019. "National Income and Trust," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1913, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
  • Handle: RePEc:ays:ispwps:paper1913
    as

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    File URL: https://icepp.gsu.edu/files/2019/08/paper1913.pdf
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    References listed on IDEAS

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