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Sociology Trust
by
Karen Cook, Bogdan State

Introduction

Trust is a recurrent theme in social science literature. In the past four decades it has become the focus of a great deal of empirical work in efforts to identify its causes and effects in social life. Several key book-length monographs and edited collections seem to have stimulated the growth of research and writing on trust in the social sciences. Among these volumes were the 1988 volume edited by Diego Gambetta, Trust: Making and Breaking Cooperative Relations and the widely circulated book by Frances Fukuyama, Trust: Social Virtues and the Creation of Prosperity, published in 1995. A number of themes in these two volumes set the agenda for subsequent research including efforts to understand the linkages between trust and economic development, an agenda that Robert Putnam, a political scientist, took up as he put the thesis of declining civic participation at the center of criticisms of modern societies. For Putnam the core claim was one of the demise of social capital, which included declining social trust. We discuss the literature that focuses specifically on trust at various levels of analysis (interpersonal, organizational, interorganizational and institutional), but we separate this discussion from the more general category of work on social capital, originally defined by Putnam as encompassing networks, norms, and trust. The field of trust research is truly interdisciplinary with contributions from philosophy and all of the social sciences, especially psychology, political science, sociology and, more recently, behavioral economics and anthropology. There is no distinctive sociological perspective on trust, but sociologists are more likely to focus on interpersonal trust, organizational trust, and institutional trust. Cook, et al. 2007 presents one sociological perspective on relational trust focusing on trust at the interpersonal level and arguing that it is much more difficult to trust organizations and large-scale institutions such as government given the knowledge that would be required to trust an entity of this size. In this review we cover many of the important papers that have set the research agenda concerning the role of trust in society. No single discipline can claim to have covered this topic in its entirety.

Book Series and Handbooks

The Russell Sage Foundation book series on trust co-edited by Karen S. Cook, Russell Hardin, and Margaret Levi includes a number of influential books in many different domains by key authors who have conducted empirical work on trust at different levels of analysis, as well as several major theoretical treatments of the topic. The books in this series, many the result of workshops over the past decade, are referenced at the Russell Sage Foundation. The Handbook of Trust Research (Bachmann and Zaheer 2006) is one of the first handbooks to summarize research over fifteen years on trust, especially the work focused on organizations and management. Besides the Russell Sage Foundation book series there are no handbooks that cover the breadth of work that has been done on trust. The only exception is the handbook on trust research listed below that covers the field of organizational trust.

  • Bachmann, Reinhard, and Akbar Zaheer, eds. 2006. Handbook of trust research. Northampton, MA: Edward Elgar.

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    Summarizes key theoretical conceptualizations and empirical studies of many investigators primarily from business schools in the United States and Europe. It brings together work that focuses on management and leadership in increasingly nonhierarchical settings. It also examines the role of trust in organizational processes as well as in interorganizational relationships in a global context, and discusses the role of trust in the economy more generally.

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Data Sources

Several general surveys have been used widely in the past few decades in the analysis of trust and its correlates. These include the General Social Survey conducted in the United States; the European Social Survey, a similar enterprise in Europe; and the World Values Survey, which includes a broad array of countries and topics. The General Social Survey is conducted at the University of Chicago each year. During its numerous administrations beginning in 1972, the survey has asked a variety of trust-related questions. Most notably, the GSS has tracked general trust. In addition, special modules of the survey have investigated trust in multiple contexts: social groups, the family, the workplace or the doctor-patient relationship being a few examples. These surveys are included here because they have provided the bulk of the evidence, beyond a small amount of experimental evidence, concerning attitudes about trust and cross-cultural differences in trust, which are substantial.

  • European Social Survey.

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    This survey is similar to the GSS, although it is a less-explored data source in analyses of trust-related phenomena. This survey is a biennial, pan-European project now recording its fifth wave of survey administration since its beginning in 2002. The European Social Survey includes not only data on social and general trust but also tracks trust in political institutions.

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    • General Social Survey.

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      This survey is the longest running project of the National Opinion Research Center at the University of Chicago since 1972. It monitors social change and the growing complexity of American Society through the collection of demographic and attitudinal information. It is also linked to a number of similar surveys done in other countries.

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      • World Values Survey.

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        This survey is frequently used in trust research worldwide and is currently undergoing a new wave of data collection in 2010–2011. The WVS includes a number of measures of trust in a variety of countries. While the 1990 wave featured questions on general trust, trust in various social groups, as well as trust in government, later waves only pursued the former two questions. In collaboration with the European Social Survey (EVS) five waves have been completed from 1981 to 2007.

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        Journals

        There is one new journal dedicated to the publication of trust research, published by Routledge. Peter Li, at the University of Copenhagen Business School, is the current editor of the Journal of Trust Research. It is the only journal exclusively devoted to this topic. The value of this new journal is that it will provide a single outlet for much of the research being done on trust in various settings, but in particular in organizations, business, and the international arena.

        Classic Works and General Statements

        In this section we identify a few of the readings that served to define trust and set the stage for much of the subsequent theoretical debate and research on the role of trust in society. While there is no widely accepted definition of trust, there are a number of important theoretical orientations to the topic that are reflected in the classic works on trust. Barber 1983, Luhmann 1979, and Luhmann 1998 discuss the ways in which trust is central to social relations and social organization, while Coleman 1990 introduces the topic in his major work on social theory and develops the seeds of a rational choice perspective on trust. Morton Deutsch, a social psychologist, conducted one of the earliest experiments on trust attempting to specify the conditions under which interpersonal trust emerges (Deutsch 1958). Lewis and Weigert 1985 introduces the notion that trust serves to reduce complexity in an information-rich environment and thus facilitates action. Pettit 1995 examines the factors that lead to trust, which the author defines as an act of making oneself vulnerable to another based on perceived loyalty, virtue, or prudence. The book that put trust on the agenda for those interested in societal-level effects of trust in different cultural contexts is Fukuyama 1995, and Cook 2003 provides an introduction to the different perspectives on trust and the ways in which it has been used empirically to understand the production of social order and cooperation at various levels in society. These contributions generally provide some insight into the varied ways in which trust has been approached by different disciplines. Barber, Coleman, Cook and Luhmann are sociologists, and the others are psychologists, philosophers or historians who have analyzed (Pettit, Fukuyama) or conducted experiments on trust (Deutsch).

        • Barber, Bernard. 1983. The logic and limits of trust. New Brunswick, NJ: Rutgers Univ. Press.

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          Barber makes an important distinction between the various ways in which trust can fail: the fiduciary obligations of actors when it is their duty to represent others’ best interests, the technical competence of individuals acting in roles, and when morality fails. His focus is primarily on the ways in which trust expectations are not met (i.e., when trustworthiness is lacking).

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        • Coleman, James S. Trust. In Foundations of social theory. By James S. Coleman, 91–116. Cambridge, MA: Harvard Univ. Press, 1990.

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          The paper’s most prominent contribution is its clear definition of the trust game, as well as its discussion of the significance of trust in allowing for otherwise impossible social action. Coleman also develops the subject of trust using the principle of utility maximization and discusses the factors that determine trustworthy behavior on the part of the trustee.

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        • Cook, Karen S., ed. 2003. Trust in society. New York: Russell Sage Foundation.

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          This early interdisciplinary edited volume includes important pieces by many of those who later developed key theoretical approaches to the study of trust, in particular Gambetta and Bacharach, Kramer, Hardin, and others in political science, sociology, and psychology. This volume begins with theories of trust and then includes empirical chapters on the role of trust in various settings.

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        • Deutsch, Morton. 1958. Trust and suspicion. Journal of Conflict Resolution 2.4: 265–279.

          DOI: 10.1177/002200275800200401Save Citation »Export Citation »E-mail Citation »

          Deutsch differentiates trust from expectation and risk, further discussing suspicion and the mutuality of trust. He shows experimentally how trust can be achieved even when an overt orientation to each other’s welfare does not exist between partners. In these circumstances Deutsch finds the emergence of trust to be more likely in situations involving extensive communication, control, or the presence of a mutually disagreeable third party.

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        • Fukuyama, Francis. 1995. Trust: The social virtues and the creation of prosperity. New York: Free Press.

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          Fukuyama argues that social trust varies by culture and that this variation correlates with economic development. He compares individualistic societies in which sociability often centers on nonkinship relations with more familial societies. He also contends that the capacity to form large-scale organizations that extend beyond family is critical.

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        • Lewis, David J., and Andrew Weigert. 1985. Trust as a social reality. Social Forces 63.4: 967–985.

          DOI: 10.2307/2578601Save Citation »Export Citation »E-mail Citation »

          Lewis and Weigert discuss the general importance of trust in social systems. They conceive of trust as a mechanism for reducing informational complexity typically present in social relationships. The authors argue against the purely behavioral view of trust and contend that it is improper to study trust in experimental one-shot games such as the prisoner’s dilemma.

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        • Luhmann, Niklas. 1979. Trust: A mechanism for the reduction of social complexity. In “Trust” and “Power”: Two works. By Niklas Luhmann. Chichester, UK: Wiley.

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          The book adopts a systems perspective on trust, with roots in the functionalist tradition in sociology. For Luhmann, trust solves the problem of social complexity, of the essential uncertainty surrounding the future. While acknowledging the importance of interpersonal trust as a building block of social life, Luhmann also contends that institutional, depersonalized trust represents the most important form of trust in advanced societies.

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        • Luhmann, Niklas. 1988. Familiarity, confidence, trust: Problems and alternatives. In Trust: Making and breaking cooperative relations. Edited by Diego Gambetta, 94–107. New York: Blackwell.

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          Luhmann examines the distinctions between three related concepts: familiarity, confidence, and trust. Familiarity represents the known and is based on frequent interaction, often with no risk involved. Trust is a solution to a specific problem of risk, whereas confidence is a means of dealing with danger. Luhmann contends that confidence, familiarity, and trust may be partial substitutes under certain conditions.

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        • Pettit, Philip. 1995. The cunning of trust. Philosophy & Public Affairs 24.3: 202–225.

          DOI: 10.1111/j.1088-4963.1995.tb00029.xSave Citation »Export Citation »E-mail Citation »

          Pettit examines the nature of trust defined as “interactive, trusting reliance,” in which an actor relies on another in a manifest way, expecting the trustee to carry through as a result of the trustee’s desire for ascertaining their reliability. Three mechanisms are seen as building trust: loyalty, virtue, and prudence. These are all reasons why the trustee can be expected to respond positively.

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        Theories of Trust and Trustworthiness

        There are a number of differing theoretical perspectives on trust. We identify some of the more distinctive approaches to the study of trust and delineate briefly how they differ in descriptions of some of the key publications. It was necessary to be highly selective given the extensive social science literature on this topic, both theoretically and empirically. The pieces we have selected to annotate consist of some of the most significant papers that define trust and distinguish it from cooperation and other mechanisms that contribute to the production of social order. One of the key reasons for interest in trust is the effort to understand the role of trust in producing cooperation at the interpersonal level as well as at the organizational and institutional level. For this reason much of the early work on trust was linked directly to research on cooperation, and many of the empirical investigations of trust have explicitly examined cooperation as an important product of trust. Axelrod 1984 is a famous monograph on the evolution of cooperation that provided an analysis of the various factors that promote or inhibit strategic cooperation. Building on this work, Hardin and others subsequently developed more strategic models of relations of trust. Hardin’s approach (Hardin 1992, Hardin 2002) later came to be known as the “encapsulated interest” model of trust relations focusing on the conditions under which trust is likely to emerge between two parties as well as specifying the determinants of trustworthiness. Cook, et al. 2007 extended Hardin’s approach to clarify the conditions under which cooperation is produced without trust. Related conceptions of trust include Gambetta 1988, an important work on signaling, and Gambetta’s subsequent empirical research with Hamill on trustworthiness and the ways in which individuals figure out who can be trusted (Gambetta and Hamill 2009). Other theoretical perspectives have been proposed in a number of disciplines. Rousseau, et al. 1998 discusses the similarities and differences in approaches to the study of trust, focusing on a more psychological orientation common to many conceptions of trust as the acceptance of vulnerability. It also identifies several different forms of trust that move beyond the more strategic conceptualizations. Williamson 1993’s contrarian view is that trust has a limited role in nonpersonal (e.g., economic) relations and should be most useful conceptually in the analysis of close personal relationships.

        • Axelrod, Robert. 1984. The evolution of cooperation. New York: Basic Books.

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          Using the prisoner’s dilemma game as the basis for his formulation, Axelrod demonstrates how an evolutionarily stable strategy better known as “tit for tat” develops and is relatively resistant to invasion, once established in a social setting. This agenda-setting book stimulated much of the subsequent experimental (and simulation) work on cooperation, reciprocity, and trust, especially that based on iterated PD games.

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        • Cook, Karen S., Russell Hardin, and Margaret Levi. 2007. Cooperation without trust? New York: Russell Sage Foundation.

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          The authors argue that while trust may play a larger role in interpersonal relationships and potentially in networks of relationships, it is much less likely to provide adequate support for larger-scale enterprises. The authors clarify the links between confidence, reliability, and trust and generally argue against the thesis that general trust produces social order. What is referred to in the literature as general trust may instead be a consequence of social order.

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        • Dasgupta, Partha. 1988. Trust as a commodity. In Trust: Making and breaking cooperative relations. Edited by Diego Gambetta, 49–72. New York: Blackwell.

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          Dasgupta proposes a model in which actors are split between two groups, each sharing a dominant strategy—either honesty or cheating—with no reputation system present. Dasgupta complicates the model by introducing memory and reputations; agents form expectations about others based on their knowledge of other’s history and develop expectations about the world based on their own experiences.

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        • Gambetta, Diego. 1988. Can we trust trust? In Trust: Making and breaking cooperative relations. Edited by Diego Gambetta, 213–237. New York: Blackwell.

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          Gambetta puts forth one of the most frequently cited definitions of trust, seen as a subjective probability evaluation. He views trust as a probability threshold, the relevance of which is predicated on the existence of uncertainty. Gambetta also rejects the view that trust is a scarce resource that needs to be “economized.”

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        • Gambetta, Diego, and Heather Hamill. 2009. Streetwise: How taxi drivers establish customers’ trustworthiness. New York: Russell Sage Foundation.

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          Gambetta and his co-author examine in some detail the ways in which taxi drivers determine who they can safely pick up for a ride in New York City and Belfast. The key question they address is whether taxi drivers in dangerous cities pay more attention to hard-to-fake signals when evaluating potential customers.

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        • Hardin, Russell. 1992. The street-level epistemology of trust. Analyse und Kritik 14:152–176.

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          Hardin combines rational-choice and cognitive approaches in developing a theoretical model of trust using a “common sense” Bayesian approach. Prior experience with trust is seen as important in determining one’s willingness to trust new partners. Overall, Hardin’s model describes an individual’s propensity to trust as the result of a lifelong learning process in which new experiences continuously update the actor’s priors.

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        • Hardin, Russell. 2002. Trust and trustworthiness. New York: Russell Sage Foundation.

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          Hardin describes trust as a three-part relation. One actor may trust another with respect to a particular domain of activity to the extent that the trustee’s interests are encapsulated in those of the trustor. This is more likely to occur if the relationship is valued and/or if the trustee cares about his reputation for trustworthiness. This volume is one of the first to make clear the analytical distinction between trust and trustworthiness.

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        • Rousseau, Denise M., Sim B. Sitkin, Ronald S. Burt, and Colin F. Cemerer. 1998. Not so different after all: A cross-discipline view of trust. Academy of Management Review 23.3: 393–404.

          DOI: 10.5465/AMR.1998.926617Save Citation »Export Citation »E-mail Citation »

          This review article covers debates over definitions of trust, static and dynamic views of trust, the role of trust in causal frameworks, and the problem of levels of analysis in investigations of trust. The authors also identify different forms of trust: calculus-based, deterrence-based, relational, and institutional. The authors suggest that a transition might be occurring in the prevailing forms of trust from institutional to individual and network-based trust.

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        • Williamson, Oliver E. 1993. Calculativeness, trust, and economic organization. Journal of Law and Economics 36.1: 453–486.

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          Williamson contends that trust is nothing more than a risk evaluation, and therefore relations that are described by the blanket term “trust” should instead be analyzed through the prism of “competent calculativeness.” He sees trust as an alternative mode of interaction to the contractual framework implied by calculativeness, reserving “nearly noncalculative” personal interactions for trust, where monitoring is not feasible.

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        Survey Measures

        Many of the research projects undertaken to study trust at various levels of analysis have used survey methods to obtain data on trust. The General Social Survey and the World Values Survey are just two of the questionnaires that have included items to measure general trust as well as trust in specific institutions, people, or groups. The American National Election Survey (ANES) has also included items measuring trust during some waves. We mention only a few of the articles that include survey analysis, some mixing this method of investigation with other methods, such as experiments or field studies. One of the first attempts to develop items that would measure trust in the context of interpersonal relationships was Rotter 1967, published in the Journal of Personality. Larzelere and Huston 1980 also produced a useful scale for measuring trust in close personal relations. Many subsequent efforts have been focused on creating new survey items to measure trust (e.g., Yamagishi and Yamagishi 1994), attempting to clarify the meaning of existing measures (e.g., Miller and Mitamura 2003), or developing new ways of judging the validity of the survey measures as predictors of trusting behavior (e.g., Glaeser, et al. 2000). Continued advances in measurement techniques and embedded experiments in surveys will help us better assess levels of trust and allow us to develop more fine-grained conceptualizations.

        • Glaeser, Edward L., David I. Laibson, Jose A. Scheinkman and Christine L. Soutter. 2000. Measuring trust. Quarterly Journal of Economics 115.3: 811–846.

          DOI: 10.1162/003355300554926Save Citation »Export Citation »E-mail Citation »

          Glaeser and his colleagues use a mix of survey and experimental methods to examine the relationship between general trust survey items and actual entrusting behavior. The authors find that reported past trusting behavior predicts current trusting behavior and that reported general trust predicts current trustworthy behavior but not entrusting behavior. However, questions eliciting trust in strangers do predict entrusting behavior.

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        • Larzelere, Robert E., and Ted L. Huston. 1980. The dyadic trust scale: Toward understanding interpersonal trust in close relationships. Journal of Marriage and the Family 42.3: 595–604.

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          The authors develop an eight-item dyadic trust scale to gauge trust in intimate, romantic relationships. The scale is tested on a sample of several hundred dyads in several marital stages (dating, married, divorced). Larzelere and Huston find trust to be the only consistently reciprocated feeling among their subjects; the subjects’ trust also appears to be correlated with their love for their partner.

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        • Miller, Alan S., and Tomoko Mitamura. 2003. Are surveys on trust trustworthy? Social Psychology Quarterly 66.1: 62–70.

          DOI: 10.2307/3090141Save Citation »Export Citation »E-mail Citation »

          Miller and Mitamura discuss measurement problems involved in the standard question used to measure general trust in most surveys. The authors demonstrate that the question contrasts trust with caution, rather than distrust, and that this conceptual mismatch may help explain some surprising results, such as males being found to be higher in trust than females when using this instrument.

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        • Rotter, Julian B. 1967. A new scale for the measurement of interpersonal trust. Journal of Personality 35.4: 651–665.

          DOI: 10.1111/j.1467-6494.1967.tb01454.xSave Citation »Export Citation »E-mail Citation »

          Rotter presents and tests an instrument for measuring interpersonal trust, based on social learning theory. Rotter’s conception of trust is based on reinforcement as a result of experience and on the generalization of experience to others with whom the subject has no previous experience. After presenting the rationale for the scale, Rotter examines its reliability in an empirical setting.

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        • Yamagishi, Toshio, and Midori Yamagishi. 1994. Trust and commitment in the United States and Japan. Motivation and Emotion 18.2: 129–166.

          DOI: 10.1007/BF02249397Save Citation »Export Citation »E-mail Citation »

          The paper contradicts the conventional view according to which Japanese society is higher in trust than American society. The authors argue that Japan has more developed assurance structures than the United States, which reduce the need for interpersonal trust. Comparative survey results confirm the authors’ predictions, with American respondents higher in general trust than Japanese respondents.

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        Experimental Measures

        An alternative to the study of trust through the use of social surveys is the conduct of experiments on behavior that might be an indicator of trust. There are a number of experimental paradigms in use for the experimental study of trust, but one of the most common is the trust game and versions of it. Perhaps the most widely used is the one-shot game described in Berg, et al. 1995, initially designed as a simple setting in which trust is clearly detected behaviorally. More commonly researchers now use a repeated game with variable investment levels allowing for the behavioral measurement of degree of trust and reciprocity (see Ostrom and Walker 2005). There are also important efforts to design experiments that can distinguish trust-related behaviors from risk-taking behaviors, as Eckel and Wilson 2004 illustrates. In more recent work researchers have begun to explore biological and neurological determinants of trusting behavior (e.g., Fehr 2009), an important avenue for future research.

        • Berg, Joyce, John Dickhaut, and Kevin A. McCabe. 1995. Trust, reciprocity, and social history. Games and Economic Behavior 10: 122–142.

          DOI: 10.1006/game.1995.1027Save Citation »Export Citation »E-mail Citation »

          Introduces the “investment game,” in which one subject entrusts another with a sum of money from which the trustee can keep any amount for themselves. The Nash equilibrium prediction of no money being sent is rejected categorically. Both amount and frequency of reciprocation increase when subjects are provided with the social history of interaction.

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        • Eckel, Catherine C., and Rick K. Wilson. 2004. Is trust a risky decision? Journal of Economic Behavior and Organization 55.4: 447–465.

          DOI: 10.1016/j.jebo.2003.11.003Save Citation »Export Citation »E-mail Citation »

          Eckel and Wilson challenge the long-held view in trust literature that the decision to entrust is seen as a risky decision akin to a gamble. The authors use an experimental design to show that measures of risk aversion are not significantly correlated with the decision to trust a stranger, a prediction of the trust-as-gamble hypothesis. This study is at odds with many that argue the significance of risk in the decision to trust.

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        • Fehr, Ernst. 2009. On the economics and biology of trust. Journal of the European Economic Association 7.2–3: 235–266.

          DOI: 10.1162/JEEA.2009.7.2-3.235Save Citation »Export Citation »E-mail Citation »

          Fehr notes important differences between risk and betrayal aversion in the trust game. Fehr adduces neurobiological and behavioral evidence in support of this contention that the latter kind of preference to be crucial in understanding entrusting. Fehr further distinguishes between exogenous preferences and endogenous beliefs in the trust game and of potential solutions to the problem of causality in field studies of trust.

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        • Ostrom, Elinor, and James S. Walker, eds. 2005. Trust and reciprocity. New York: Russell Sage Foundation.

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          This volume includes a number of chapters that explore issues of trust and reciprocity primarily using game theoretic formulations and experimental methods. Several chapters provide an overview of what we know about the conditions that produce cooperation under varying conditions, especially the institutional mechanisms that foster cooperation and facilitate collective action, when self-interest would mitigate against it due to the possibility of free-riding.

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        Interpersonal or Relational Trust

        A major focus of the research on trust is the trust that develops in interpersonal relationships, often called “relational trust” when distinctions are made between levels of analysis. In this category of work some researchers study the trust of specific people for one another or the trust that develops between people in particular culturally defined categories or groups (Cultural and Ethnic Differences). Others focus on the trust of other people in general (Interpersonal Trust and Distrust). We refer to this latter work as research on general trust. Several large surveys have been done both within the United States and in a number of other countries (included in the World Values Survey) that try to determine the levels of general trust between people in specific regions or countries; but this method of investigation is not particularly well suited to the study of interpersonal trust. Thus experimental research has grown more popular as a method for investigating trust between people. We summarize below some of the more influential articles and books on this type of trust.

        Cultural and Ethnic Differences

        A key question that is addressed by Brewer 1981 and Habyarimana, et al. 2009 is the extent to which trust is frequently limited to those we deem to be similar to ourselves, a consequence of in-group bias or ethnocentrism as well as the tendency to view those similar to us as more trustworthy. A number of studies explore more deeply the reasons for cross-cultural variation in levels of trust under varying conditions. Good examples of this type of work include Buchan, et al. 2002 on trust and reciprocity and by Yamagishi, et al. 1998 comparing the United States and Japan.

        • Brewer, Marilyn B. 1981. Ethnocentrism and its role in interpersonal trust. Scientific Inquiry and the Social Sciences 214: 345–360.

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          Uses a combination of survey and ethnographic research methods to investigate the relationship between in-group identification, out-group attitudes, and interpersonal trust. Although the in-group/out-group distinction is found to be variable throughout the world, a consistent finding emerges according to which in-group members are seen to be more trustworthy, honest, and loyal.

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        • Buchan, Nancy R., Rachel Croson, and R. M. Dawes. 2002. Swift neighbors and persistent strangers: A cross cultural investigation of trust and reciprocity in social exchange. American Journal of Sociology 108.1: 168–206.

          DOI: 10.1086/344546Save Citation »Export Citation »E-mail Citation »

          Finds, in a comparative experiment, a significant decrease in entrusting and reciprocity in generalized exchange compared to direct exchange. The results differ from the game-theoretic prediction of no entrusting and no reciprocation. Unexpectedly, the experiment reveals negative correlations between levels of trust and reciprocation in South Korea and the United States, suggesting a more complex relationship between entrusting and cooperation than previously thought.

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        • Habyarimana, James, Macartan Humphreys, Daniel N. Posner, and Jeremy M. Weinstein. 2009. Coethnicity: Diversity and the dilemmas of collective action. New York: Russell Sage Foundation.

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          The authors explore the reasons co-ethnics collaborate to their benefit in ethnically homogeneous settings, when compared to those composed of distinct ethnic groups. The research is conducted in Kampala, Uganda, using both field experiments and surveys. The results challenge the dominant view that in-group favoritism accounts for collective action. The authors demonstrate that social norms of reciprocity are key to explaining their findings.

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        • Yamagishi, Toshio, Karen S. Cook, and M. Watabe. 1998. Uncertainty, trust, and commitment formation in the United States and Japan. American Journal of Sociology 104.1: 165–194.

          DOI: 10.1086/210005Save Citation »Export Citation »E-mail Citation »

          Tests and confirms the proposition that commitment is most likely to arise between individuals in situations of social uncertainty, by varying both the risk and the magnitude of a negative payoff in the trust game. Once uncertainty is accounted for, the authors find no support for any country-specific differences between the United States and Japan, the two sites of their experimental work.

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        Interpersonal Trust and Distrust

        Close personal relationships have always been the locus of much of the research on trust and distrust. Some of the earliest work on trust is focused on such relationships. Rempel, et al. 1985, for example, talks about the connections between interpersonal trust, intimacy, and love in a survey of those involved in close relationships. An important distinction that has gained traction, especially in the study of interpersonal trust, is the distinction between cognitive and affective trust developed by McAllister 1995. More recently, investigative studies such as Lewicki, et al. 2006 have explored the varied determinants of these two types of trust and the linkages between them. Emotion plays a larger role in affective trust, as well as in situations in which distrust arises. A detailed exploration of distrust at various levels of analysis (beyond the interpersonal level) is included in Hardin 2004, and Kramer 1998 explores the forms of paranoid cognition that develop in the context of interpersonal relationships in which there is a difference in power between those involved. Early on, Rotter 1980 made an important distinction between trust and gullibility, separating informed judgments of trustworthiness from those that are not, which can lead to exploitation and distrust. A major focus of the current work on trust is specifying the mechanisms that support trusting relations between individuals who have “weak ties” rather than “strong ties” to one another as is more common in networks that extend well beyond local ties to include global connections between actors. Cook and Hardin 2001 talks about the differences between small towns in which norms work to sanction misplaced trust and large-scale networks where behavior is difficult to monitor and sanctions hard to manufacture.

        • Cook, Karen S., and Russell Hardin. 2001. Norms of cooperativeness and networks of trust. In Social norms. Edited by Michael Hechter and Karl-Dieter Opp, 327–347. New York: Russell Sage Foundation.

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          The authors argue that there are two distinct modes of social organization that result in conditions which foster cooperation. In small groups, norms of cooperativeness emerge to support collective endeavors along with fairly effective sanctions for violating such norms. However, in larger organizations and networks of social relations among individuals who may not know each other well, trust becomes essential.

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        • Hardin, Russell, ed. 2004. Distrust. New York: Russell Sage Foundation.

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          Analyzes how distrust can be managed and the difficulties in repairing relations of distrust. While distrust is hard to overcome, in some settings it is appropriate and it serves to make people wary of others and of institutions that are corrupt or have the potential to abuse trust. Related topics covered include corruption, distrust between groups, honor killings, terrorism, and the role of law in mitigating distrust.

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        • Kramer, Roderick M. 1998. Paranoid cognition in social systems: Thinking and acting in the shadow of doubt. Personality and Social Psychology Review 2.4: 251.

          DOI: 10.1207/s15327957pspr0204_3Save Citation »Export Citation »E-mail Citation »

          Kramer introduces “paranoid social cognition” as an “exaggerated” form of distrust, though not one that is necessarily pathological. Kramer divides paranoid cognitions into three classes: overtly personalistic construal, the sinister attribution error, and the exaggerated perception of conspiracy. He proposes that certain social locations make such paranoid cognitions more likely. The results from a number of studies are presented that support this thesis.

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        • Lewicki, R. J., E. C. Tomlinson, and N. Gillespie. 2006. Models of interpersonal trust development: Theoretical approaches, empirical evidence, and future directions. Journal of Management 32.6: 991–1022.

          DOI: 10.1177/0149206306294405Save Citation »Export Citation »E-mail Citation »

          The authors divide psychological views of trust into three main schools of thought: uni-dimensional, with trust and distrust part of the same process; two-dimensional, with trust separate from distrust; and transformational, in which trust evolves in stages, usually in a gradation from the calculative to the affective. The authors also raise the issue of insufficient scientific knowledge with respect to measurement of trust.

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        • McAllister, David J. 1995. Affect- and cognition-based trust as foundations for interpersonal cooperation in organizations. Academy of Management Journal 38.1: 24–59.

          DOI: 10.2307/256727Save Citation »Export Citation »E-mail Citation »

          This influential article elaborates a theoretical framework for the understanding of trust in organizations. More specifically, the author argues for the differentiation of interpersonal trust in organizations along two dimensions: cognitive and affective, with the former a prerequisite for the latter. After presenting his framework, McAllister conducts an empirical test of his main thesis with data from a sample of managers, using structural-equation modeling.

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        • Rempel, John K., John G. Holmes, and Mark P. Zanna. 1985. Trust in close relationships. Journal of Personality and Social Psychology 49.1: 95–112.

          DOI: 10.1037/0022-3514.49.1.95Save Citation »Export Citation »E-mail Citation »

          Rempel and his coauthors discuss the relationship between trust—seen as faith, predictability and dependability—motives, and the success of close relationships. A dyadic survey of those involved in close relationships reveals that trust is crucial to the development of intimacy and love between partners and that faith has the strongest positive effect.

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        • Rotter, Julian B. 1980. Interpersonal trust, trustworthiness, and gullibility. American Psychologist 35.1: 1–7.

          DOI: 10.1037/0003-066X.35.1.1Save Citation »Export Citation »E-mail Citation »

          Reviews research on the relationship between trust and trustworthy behavior and on the link between trust and gullibility. He cites several studies that establish a link between general trust and trustworthy behavior in individuals. Rotter also rejects the idea that gullibility and high trust are equivalent. Multiple studies show that high-trusters are not more likely to trust in the face of contrary evidence.

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        Micro-Level Dynamics

        A number of publications attempt to analyze the emergence of trust over time in various settings, in particular in dyadic relations and in networks of individuals who form relations of cooperation (e.g., Buskens 2002) sometimes based on trust. Some of this work extends empirical analysis by developing simulations that assist in the development of theory (e.g., Macy and Skvoretz 1998). Much of the research focuses on the micro level, examining for example the degree to which commitment between individuals leads to trust (see Kollock 1994) and the role that risk and trust play in decisions to engage in various types of exchange (see Cook, et al. 2005 and Molm, et al. 2000). A related development is the investigation of other commitment mechanisms that bind the individuals to one another and thus foster trustworthiness. One such mechanism involves providing something of value as a “bond” that is lost if trust fails. Snijders and Buskens 2001 and Raub 2004 refer to this strategy as “hostage posting.”

        • Buskens, Vincent. 2002. Social networks and trust. Dordrecht, The Netherlands: Kluwer.

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          Buskens investigates the emergence of trust in social networks and the linkages between trust, control, and learning. In this volume, the author presents the results of simulations and experimental tests of theory that help to tease apart the mechanisms that underlie the development of trust in small-scale social systems.

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        • Cook, Karen S., Toshio Yamagishi, Coye Cheshire, Robin Cooper, Masafumi Matsuda, and Rie Mashima. 2005. Trust building via risk taking: A cross-societal experiment. Social Psychology Quarterly 68.2: 121–142.

          DOI: 10.1177/019027250506800202Save Citation »Export Citation »E-mail Citation »

          Compares a classical prisoner’s dilemma design to a modified prisoner’s dilemma with risk-taking and finds more cooperation when players can choose the amount entrusted. As expected, there is less trust building occurring in risk-averse Japan than in the United States. More cooperation resulted from fixed-partner games than from random-partner games, indicating the presence of a “shadow of the future” (see Axelrod 1984, cited under Theories of Trust and Trustworthiness).

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        • Kollock, Peter. 1994. The emergence of exchange structures: An experimental study of uncertainty, commitment, and trust. American Journal of Sociology 100.2: 313–345.

          DOI: 10.1086/230539Save Citation »Export Citation »E-mail Citation »

          Uses an exchange experiment to investigate the effect of uncertainty on the creation of exchange networks. Kollock finds interpersonal trust and committed exchange relationships are significantly more likely under high uncertainty. Likewise, concern for sellers’ reputations was higher under conditions of uncertainty. Kollock also points out the complexity of exchange strategies and argues for a finer-grained measure of commitment.

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        • Macy, Michael W., and John Skvoretz. 1998. The evolution of trust and cooperation between strangers: A computational model. American Sociological Review 63.5: 638.

          DOI: 10.2307/2657332Save Citation »Export Citation »E-mail Citation »

          Uses computer simulations based on a genetic algorithm to investigate the evolution of trust and cooperation in a variably embedded prisoner’s dilemma, where actors have different possibilities of interacting with neighbors and complete strangers. Two kinds of stable strategies appear in the simulations: parochial and universalistic. Parochialism is found to emerge when exit is a costly option, whereas the emergence of universalistic strategies is more likely in small neighborhoods.

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        • Molm, Linda D., N. Takahashi, and G. Peterson. 2000. Risk and trust in social exchange: An experimental test of a classical proposition. American Journal of Sociology 105.5: 1396–1427.

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          Tests whether trust and commitment arise more readily in reciprocal, rather than negotiated, exchange. The exchange experiment performed by the authors provides evidence supportive of this proposition. Furthermore, low-power situations are found to engender trust more frequently than high-power settings. Unexpectedly, the actors also uncover a strong interaction effect: trust increases disproportionally in situations of low-power reciprocal exchange.

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        • Raub, Werner. 2004. Hostage posting as a mechanism of trust: Binding, compensation, and signaling. Rationality and Society 16.3: 319–365.

          DOI: 10.1177/1043463104044682Save Citation »Export Citation »E-mail Citation »

          Discusses a generalized version of the Trust Game, containing uncertainty (a “move of nature” with known probability), imperfect information and hostage-posting. Raub shows that if transaction costs are low enough, and if hostages are sufficiently valuable to the trustors and of sufficiently low worth to the trustees, the problem of trust can be solved.

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        • Snijders, C., and Vincent Buskens. 2001. How to convince someone that you can be trusted? The role of “hostages.” Journal of Mathematical Sociology 25.4: 355–383.

          DOI: 10.1080/0022250X.2001.9990260Save Citation »Export Citation »E-mail Citation »

          Discusses the role of hostage posting in the trust game and restricts analysis to nonbribing hostages that are not fully binding for the trustee. The study shows that hostage posting significantly influences players’ intentions to trust each other but fails to show any evidence of the binding aspect of a hostage being significant in the trust decision.

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        Macro-Level Dynamics

        At the macro level much of the work on trust is about institutions that foster cooperation even when distrust is the norm, as in the cases examined by Banfield 1958 and Pagden 1988. In other settings various mechanisms arise to simulate trust relations where they might not otherwise exist, as in the case discussed by Ensminger 2001, involving “fictive-kin” relations. While Ensminger addresses mechanisms that work at the interpersonal level to secure significant transactions, Braithwaite 1998 focuses on the role of institutionalized distrust in providing grounds for trust in government and at a minimum some protection from the abuse of power.

        • Banfield, Edward C. 1958. The moral basis of a backward society. New York: Free Press.

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          Banfield examines a community in which distrust of those outside the family was the norm. Three factors coalesced to make concerted activity beyond the immediate family difficult: the absence of extended families, a high death rate, and particular land tenure practices, resulting in an ethos he famously labeled, “amoral familism.”

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        • Braithwaite, John. 1998. Institutionalizing distrust, enculturating trust. In Trust and governance. Edited by Valerie Braithwaite and Margaret Levi, 343–375. New York: Russell Sage Foundation.

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          Braithwaite contrasts trust in government institutions with interpersonal trust. While the benefits of interpersonal trust are backed by extensive research, the desirability of trust in government is contingent on a system of checks that promote “institutionalized distrust,” and thereby prevent governmental abuse of trust. A second major contribution is the contrast between trust-as-confidence evidenced by trustors and trust-as-obligation as perceived by the trustees.

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        • Ensminger, Jean. 2001. Reputations, trust and the principal agent problem. In Trust in society. Edited by Karen S. Cook, 186–201. New York: Russell Sage Foundation.

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          Ensminger contrasts the views of trust as calculative assessment and as means of dealing with uncertainty. The author examines the case of Orma cattle herders in Kenya. Ensminger, however, contends that even in this seemingly noncalculative example trust has a rational basis, characterizing the problem of cattle herding among the Orma as one that implies large agency costs.

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        • Pagden, Anthony. 1988. The destruction of trust and its economic consequences in the case of eighteenth-century Naples. In Trust: Making and breaking cooperative relations. Edited by Diego Gambetta, 127–141. New York: Blackwell.

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          Pagden presents a case study showing how trust can decay in a society, namely the Kingdom of Naples as part of the Spanish Empire, under the rule of the House of Hapsburg. Pagden proposes the cause for the kingdom’s brewing economic troubles in the first half of the 17th century to be the Hapsburgs’ policies, which effectively destroyed trust among the citizens of Naples.

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        General Trust

        While there is a very large literature on general trust, often simply called social trust, we only include a few examples of the empirical work on this topic. A number of other entries in this bibliography also refer to this topic. It typically refers to the degree to which individuals “trust” someone they meet without prior knowledge or an interaction history. Some theorists prefer to define this orientation toward strangers as optimism or the tendency to believe in human benevolence, while others treat general trust as the result of a kind of social intelligence that entails the capacity to judge the potential trustworthiness of others in situations in which there is potential gain from an interaction. Some define general trust as the product of an orderly society. In this sense, social order produces general social trust, since it lowers risk and uncertainty. Alesina and La Ferrara 2002 investigates the factors that cause people to trust others in general. Paxton 2007, among many others, analyzes the relationship between associational membership and general trust, while Rothstein and Stolle 2001 attempts to determine what factors lead to high and low levels of general trust. These works represent just two of the vast number of empirical efforts devoted to investigating the links between social capital and trust. Many of these investigations are similar to Delhey and Newton 2005 and Hooghe, et al. 2008, which try to tease out the factors relevant to cross-national differences in general social trust.

        • Alesina, Alberto, and Eliana La Ferrara. 2002. Who trusts others? Journal of Public Economics 85.2: 207–234.

          DOI: 10.1016/S0047-2727(01)00084-6Save Citation »Export Citation »E-mail Citation »

          The authors use regression methods to analyze General Social Survey data to determine what factors cause people to trust others. Traumatic experiences, minority-status, and lack of economic success are all found to be significant predictors of low levels of general trust in others. People are less trusting if they live in racially diverse communities, particularly if they hold anti-integration beliefs.

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        • Delhey, Jan, and Kenneth Newton. 2005. Predicting cross-national levels of social trust: Global pattern or Nordic exceptionalism? European Sociological Review 21.4: 311–327.

          DOI: 10.1093/esr/jci022Save Citation »Export Citation »E-mail Citation »

          The study investigates the heterogeneity of general trust measures between countries, as revealed by the World Values Survey. Neither anomie nor associational membership is found to be a predictor of general trust. The authors do uncover a “syndrome” of closely connected variables to general trust: Protestantism, ethnic homogeneity, economic wealth and equality, lack of corruption and democracy.

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        • Hooghe, M., T. Reeskens, D. Stolle, and A. Trappers. 2008. Ethnic diversity and generalized trust in Europe: A cross-national multilevel study. Comparative Political Studies 42.2: 198–223.

          DOI: 10.1177/0010414008325286Save Citation »Export Citation »E-mail Citation »

          Examines the effect of ethnic diversity on general trust in twenty European countries using the European Social Survey along with data on migration patterns. The authors find, using more fine-grained measures of diversity and a multilevel model, that there is little relationship between diversity and generalized trust, in contrast to Putnam’s claims to the converse.

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        • Paxton, Pamela Marie. 2007. Association memberships and generalized trust: A multilevel model across 31 countries. Social Forces 86.1: 47–76.

          DOI: 10.1353/sof.2007.0107Save Citation »Export Citation »E-mail Citation »

          Tests the effects of individual-level and country-level variables on general trust. Analysis confirms that trust increases with age, level of education, and duration of employment, has no relation to gender, and is negatively related to life events such as divorce. At the country level, the paper focuses on associational membership and develops a distinction between associations with connected and isolated membership patterns.

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        • Rothstein, Bo, and Dietlind Stolle. 2001. Social capital and street-level bureaucracy: An institutional theory of generalized trust. Paper presented at the “Trust in Government Conference” at the Center for the Study of Democratic Politics, Princeton University, 30 November 2001.

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          Seeks to explain the frequently reported variation in national and individual levels of social capital. Fair and impartial institutions are assumed to engender general trust, whereas discriminatory institutions are said to create distrust. The authors establish that inequality and corruption beget low levels of general trust, whereas a belief in the neutrality of institutions promotes social trust.

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        Organizational Trust

        There is a huge literature on the role of trust within and between organizations. In the next two sections we describe only a few such studies as examples of the wide variety of work on these topics. The work ranges from discussions of the limits of trust as a control mechanism to analyses of the significance of establishing trust in alliances or organizational networks. Trust at the interpersonal level within organizations as well as at the interorganizational level is an important issue given the limitations of incentives, monitoring, and sanctioning and the impossibility of complete contracts.

        Management Issues

        Managing relationships within organizations requires attention to factors other than control and incentives. Leaders must attend to interpersonal relationships (see McKnight, et al. 1998), gossip (see Burt and Knez 1996), feedback, commitment, performance (see Dirks and Ferrin 2001), and the nature of the organizations relationships with key stakeholders (see Currall and Epstein 2003). Establishing appropriate expectations for behavior is important as is benevolence, ability and integrity, as shown in Mayer, et al. 1995.

        • Burt, Ronald S., and M. Knez. 1996. Trust and third-party gossip. In Trust in organizations: Frontiers of theory and research. Edited by D. M. Messick and Tom R. Tyler, 68–89. Thousand Oaks, CA: SAGE.

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          Using a network dataset of managers in a large company, Burt and Knez examine the effects of third parties on interpersonal trust. More specifically, they look at gossip, or shared information about an interaction partner. The authors hypothesize that rather than determining trust or distrust, third parties act mainly to amplify the direction of either interpersonal relationship, a supposition that is confirmed empirically.

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        • Currall, Steven, and Marc J. Epstein. 2003. The fragility of organizational trust: Lessons from the rise and fall of Enron. Organizational Dynamics 32.2: 193–206.

          DOI: 10.1016/S0090-2616(03)00018-4Save Citation »Export Citation »E-mail Citation »

          Develops a framework for understanding trust in organizations. The authors differentiate between three phases: trust building, trust maintenance, and trust destruction. The framework is applied to the case of Enron and the ways in which the company’s leadership acquired and lost the trust of stockholders, employees, customers and regulators.

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        • Dirks, Kurt T., and Donald L. Ferrin. 2001. Role trust in organizational settings. Organizational Science 12.4: 450–467.

          DOI: 10.1287/orsc.12.4.450.10640Save Citation »Export Citation »E-mail Citation »

          In addition to trust’s main effect on organizationally relevant individual behaviors, the authors posit that trust acts as a moderator between motivational constructs and workplace behaviors, as well as between trustee actions and trustor responses. Dirks and Ferrin further suggest that moderating effects will arise in “strong” situations, where behavior is governed by already extant expectations.

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        • Mayer, Roger C., James H. Davis, and F. David Schoorman. 1995. An integrative model of organizational trust. Academy of Management Review 20.3: 709–734.

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          Proposes a model for trust that distinguishes between a trustor-specific propensity to trust and a trustee-specific ability, benevolence, and integrity as factors in determining trust. The model specifies risk taking as an outcome of trust but underlines the fact that trust is not necessary for such behavior to occur. The model also specifies the influence of context and the dynamic development of trust.

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        • McKnight, Harrison D., L. Larry Cummings, and Norman L. Chervany. 1998. Initial trust formation in new organizational relationships. Academy of Management Review 23.3: 473–490.

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          Addresses the long-held assumption that trust between strangers starts at a relatively low level. The authors argue for the existence of situations in which initial trust is high between two parties, and they develop a model that accounts for these situations.

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        Control and Changing Modes of Organization

        The growing interest in trust in the organizational literature has been fueled in part by rapidly changing modes of organization including dispersed production teams (Meyerson, et al. 1996), and other cooperative forms of production (Zand 1972, Tyler 2003). Arrow 1974, by a Nobel-winning economist, long ago noted the efficiency limits of organizational hierarchy and contractual obligations, which necessitate at least some reliance on trust to produce cooperation. Specialized issues arise when managing large organizations requiring more complex design decisions, especially if some of the relationships are based on trust and not control (see La Porta, et al. 1997). Many of these issues are explored in greater depth in Kramer and Cook 2007.

        • Arrow, Kenneth. 1974. The limits of organization. New York: Norton.

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          Arrow acknowledges limits in the extent to which organizations produce efficiency in the distribution of resources. He argues that trust serves as a lubricant within a social system—defining the essence of trust in his formulation as the extent to which one can rely on another person’s word. Trust in his view is built on the perceived legitimacy of authority in organizations and institutions.

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        • Kramer, Roderick M., and Karen S. Cook, eds. 2007. Trust and distrust in organizations. New York: Russell Sage Foundation.

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          Addresses issues of control and interdependence in the organizational literature as related to problems of trust and distrust. Specifically the authors address matters of trust and hierarchy, effects of monitoring and sanctioning, motivation and worker effort, managing teams and networks of employees engaged in distributed work. It concludes with discussion of the challenges to sustaining trust and reducing the negative effects of distrust.

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        • La Porta, Rafael, F. Lopez-de-Silanes, A. Shleifer, and R. Vishny. 1997. Trust in large organizations. American Economic Review 87.2: 333–338.

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          Examines the effect of general trust and trust in family members on the efficiency of government and large corporations in forty countries, using data from the 1980 and 1990 World Values Surveys. General trust has a significant, positive, and substantial effect on government performance. A similar conclusion emerges with respect to large organizations and economic growth. Furthermore, high trust in family members is detrimental to economic performance.

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        • Meyerson, Debra, Karl E. Weick, and Roderick M. Kramer. 1996. Swift trust and temporary groups. In Trust in organizations: Frontiers of theory and research. Vol. 166. Edited by David M. Messick and Tom R. Tyler, 167–195. Thousand Oaks, CA: SAGE.

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          Deals with the question of why temporary groups without the benefit of most traditional prerequisites for trust are nonetheless able to display trust quickly. The authors contend that the trust emerging in temporary groups is of a unique kind, identified as cognitive, cerebral, and action-oriented, rather than the result of a more traditional interpersonal process.

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        • Tyler, Tom R. 2003. Trust within organizations. Personnel Review 32.5: 556–568.

          DOI: 10.1108/00483480310488333Save Citation »Export Citation »E-mail Citation »

          Tyler analyzes the increasing role of trust in organizations. The author contends that trust is emerging as an important factor in organizational development as a result of the transition from command-and-control to cooperative modes of production. Tyler introduces the concept of motive-based trust as distinct from procedural justice in creating trust in organizations.

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        • Zand, Dale E. 1972. Trust and managerial problem solving. Administrative Science Quarterly 17.2: 229–239.

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          Zand develops a model of collaboration in organizational teams that predicts more effectiveness and better cohesion for teams with high levels of trust. To test these hypotheses, Zand uses an experimental design, with two groups of subjects being primed with a high- or a low-trust mind-set. He explains these results by noting that in low-trust groups the productive energy of team members is diverted into minimizing vulnerability.

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        Interorganizational Networks and Alliances

        Relationships between organizations can also be characterized in terms of the degree of trust or distrust between the key actors involved. A large body of literature focuses on the nature of interorganizational trust and its determinants. Powell 1996 discusses the various forms of trust-based governance in business. Zaheer, et al. 1998 studies specific buyer-supplier relationships, and Dyer and Chu 2000 examines supplier-manufacturer relations in order to investigate the specific role trust plays in facilitating or hindering performance. Further examination of the nature of contractual relationships and alliances between firms and in various industries by Gulati 1995 and Lorenz 1988 provide evidence that trust is essential when the stakes are high and contracts hard to specify.

        • Dyer, J. H., and W. Chu. 2000. The determinants of trust in supplier-automaker relationships in the US, Japan, and Korea. Journal of International Business Studies 31.2: 259–285.

          DOI: 10.1057/palgrave.jibs.8490905Save Citation »Export Citation »E-mail Citation »

          Examines trust levels between auto parts suppliers and car manufacturers in the United States, South Korea, and Japan. The authors contrast three frameworks: a process-based view (for which they argue), which emphasizes the interactions between players; an “embeddedness” view that ties trust to social networks; and an institutional view that underscores the role of institutions in the creation of trust.

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        • Gulati, Ranjay. 1995. Does familiarity breed trust? The implications of repeated ties for contractual choice in alliances. Academy of Management Journal 38.1: 85–112.

          DOI: 10.2307/256729Save Citation »Export Citation »E-mail Citation »

          Argues for a process-focused, temporal view of inter-firm interaction, with trust as one of the main regulatory mechanisms, distinguishing between equity-based and non-equity-based alliances. While the former kind require a relatively low level of trust, trust is crucial for non-equity-based alliances with higher opportunities of loss from defection. Gulati’s view is supported by a comprehensive, fifteen-year sample of alliances from three industries.

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        • Lorenz, Edward H. 1988. Neither friends nor strangers: Informal networks of subcontracting in French industry. In Trust: Making and breaking cooperative relations. Edited by Diego Gambetta, 194–210. New York: Blackwell.

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          Lorenz uses field data from French engineering firms to study the increasingly prevailing practice of subcontracting in the French economy. Lorenz argues that the subcontracting agreements are self-enforcing, as the potential retribution incurred from cheating is “sufficient to deter opportunism and ensure that contractual obligations are met.”

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        • Powell, Walter W. 1996. Trust-based forms of governance. In Trust in organizations: Frontiers of theory and research. Edited by David M. Messick and Tom R. Tyler, 51–67. Thousand Oaks, CA: SAGE.

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          Powell addresses the problem of trust and cooperation in the context of potentially antagonistic business relationships. Included are four contexts where high levels of trust have emerged between business partners that would ordinarily find themselves in antagonistic positions: in the case of industrial districts, R&D networks, business groups, and strategic alliances.

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        • Zaheer, Akbar, B. McEvily, and Vincenzo Perrone. 1998. Does trust matter? Exploring the effects of interorganizational and interpersonal trust on performance. Organization Science 9.2: 141–159.

          DOI: 10.1287/orsc.9.2.141Save Citation »Export Citation »E-mail Citation »

          Zaheer and his colleagues examine the ways in which trust matters at two distinct levels: the interpersonal and the interorganizational. Specifically they investigate trust in their study of buyer-seller relationships between firms engaged in electrical equipment manufacturing. In particular, they focus on the effects of trust at both levels on negotiations and ultimately on the firm performance as their key outcome variable.

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        Economic Institutions

        While there is a very large body of literature on economic institutions, we focus here on a few specific studies that provide examples of the role of incentives and institutional mechanisms for solving collective action problems that have social, political, and economic externalities. Bradach and Eccles 1999 identifies the variety of mechanisms used to manage economic transactions, ranging from price and authority to those based on trust. Complex forms of organization that extend beyond the older dichotomy of markets and hierarchy have emerged in response to the changing global environment in business and the service sector. Ostrom 2000, co-winner of the 2009 Nobel Prize in Economics, argues for incorporation of trust and reciprocity in an extension of rational-choice models of collective action, in tune with development in behavioral economics over the past decade. Additional efforts to understand the role of social factors in economic activity include Knack and Keefer 1997, a discussion of the link between general trust (a form of social capital) and economic growth and Zak and Knack 2001, an investigation of the low trust, inequality and the lack of economic growth. In addition, a number of experimental studies (e.g., Bohnet and Baytelman 2007) examine the factors in institutional environments that foster trustworthiness and thus greater trust. Importantly, when the perception of risk is high and distrust sets in, then the opportunity for economic growth is reduced (see Slovic 1993, Radaev 2005). Historically, changes in the nature of social relations and the environment have altered the conditions that produce trust in relation to the structure of economic activities (see Zucker 1986, Shapiro 1987). This list includes only a handful of the many studies using surveys and experimental methods to analyze the role of trust in the economy.

        • Bohnet, Iris, and Yael Baytelman. 2007. Institutions and trust: Implications for preferences, beliefs and behavior. Rationality and Society 19.1: 99–135.

          DOI: 10.1177/1043463107075110Save Citation »Export Citation »E-mail Citation »

          Uses experimental methods to test whether institutions influence entrusting behavior and trustworthiness. Bohnet and Baytelman do not find enough evidence against the hypothesis according to which the institutional environment affects only the players’ beliefs and not their motivations. The study finds the cost of betrayal to be the crucial factor determining the influence of institutions on beliefs about partners’ behavior in the trust game.

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        • Bradach, Jeffrey L., and Robert G. Eccles. 1999. Price, authority, and trust: From ideal types to plural forms. Annual Review of Sociology 15.1: 97–118.

          DOI: 10.1146/annurev.so.15.080189.000525Save Citation »Export Citation »E-mail Citation »

          Bradach and Eccles analyze the complex structures that underpin economic transactions in addition to markets and hierarchies. The authors argue that these mechanisms may occur not only independently but also in combination with one another, in “plural forms” such as in business groups or franchise networks. The authors propose a process-oriented view that focuses on the path-dependent emergence of complex forms.

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        • Knack, Stephen, and Philip Keefer. 1997. Does social capital have an economic payoff? A cross-country investigation. Quarterly Journal of Economics 112.4: 1251–1288.

          DOI: 10.1162/003355300555475Save Citation »Export Citation »E-mail Citation »

          Uses data from the World Values Survey to test the posited relationship between social capital (measured through general trust), and economic growth. This relationship is confirmed, but no evidence is found in support of Putnam’s contention that associational activity improves social capital and thereby economic performance. Trust is found to be high in countries with formal contract-enforcing institutions and in those countries low in class and ethnic polarization.

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        • Ostrom, Elinor. 2000. A behavioral approach to the rational choice theory of collective action. American Political Science Review 92.1: 1–22.

          DOI: 10.2307/2585925Save Citation »Export Citation »E-mail Citation »

          Argues for the development of a rational-choice model of social dilemmas and collective action that eschews the problems inherent in models that assume complete rationality. Ostrom argues for a need to combine individual-level variables as well as structural characteristics in “second-generation” models of rationality that emphasize learning processes and that use reciprocity, trust, and reputation as their building blocks.

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        • Radaev, Vadim. 2005. Establishing trust in a distrustful society: The case of Russian business. In Trust and entrepreneurship: A West-East perspective. Edited by Hans-Hermann Höhmann and Frederieke Welter, 114–135. Northampton, MA: Edward Elgar.

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          This article addresses the establishment of economic relationships and trust in environments where formal institutions are weak, with a particular focus on the role of the state. The author shows the establishment of honesty and trustworthiness to be the top priority for Russian businessmen. With the attitude of Russian entrepreneurs being adversarial toward the state, contracts are enforced privately with regard to customary rules.

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        • Shapiro, Susan P. 1987. The social control of impersonal trust. American Journal of Sociology 93.3: 623–658.

          DOI: 10.1086/228791Save Citation »Export Citation »E-mail Citation »

          Shapiro discusses the solution to the problem of trust provided by institutional mechanisms, focusing more broadly on trust at the institutional level. When interpersonal trust is infeasible or inefficient, “impersonal trust” acts as a substitute, enabling the creation of the agency relationships that dominate large, advanced societies. This solution, she argues, serves to remedy the problems inherent in contracts that are hard to write and even more difficult to monitor and enforce.

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        • Slovic, Paul. 1993. Perceived risk, trust, and democracy. Risk Analysis 13.6: 675–682.

          DOI: 10.1111/j.1539-6924.1993.tb01329.xSave Citation »Export Citation »E-mail Citation »

          Explains the observed increase in risk-perceptions among the American public at a time when objective risk has decreased. Slovic notes the asymmetric effect negative information has on risk perception and that, once entrenched, distrust perpetuates itself. Slovic argues that trust in technical assessments of risk is necessary for such communications to be effective in reducing risk perception among the public.

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        • Zak, Paul J., and Stephen Knack. 2001. Trust and growth. Economic Journal 111.470: 295–321.

          DOI: 10.1111/1468-0297.00609Save Citation »Export Citation »E-mail Citation »

          Zak and Knack predict that trust leads to growth and will be higher in homogenous societies and that income inequality and discrimination depress trust. They also posit the existence of a “low-trust poverty trap.” The model is tested using data from the World Values Survey, and the authors find empirical support for their predictions.

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        • Zucker, Lynn G. 1986. Production of trust: Institutional sources of economic structure, 1840–1920. Research in Organizational Behavior 8:53–111.

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          Zucker examines the emergence of formal trust structures historically in the United States. She argues that a series of exogenous factors, such as migration and an unstable economy disrupted interpersonal trust and generated a need for formal trust structures. She identifies bureaucracy, credentialing, a service economy, and a regulatory apparatus as the four most important of such structures.

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        Political Institutions

        A number of articles and books have been written that focus on the trust that citizens have in government and political leaders (see Hetherington 1998) in addition to local political institutions (see Levi and Stoker 2000). Evidence suggests that trust is higher in local leaders than in those at a distance, in much the same way individuals tend to trust their doctor but not physicians in general. The same tends to hold for politicians. It is also argued in this body of literature that trust may not be essential to the working of political institutions and that institutionalized forms of distrust as checks and balances on the abuse of power are often more effective than reliance on personal trust relations. The stakes are simply too high. More general treatments of the ways in which trust is related to matters of governance are explored in Braithwaite and Levi 2003. Several key debates continue to frame the research on trust and politics. One is the role of social capital and more specifically civic participation and general trust in democratic forms of government (see Putnam, et al. 1993 and Uslaner 2000). Some evidence suggests that trust is more frequently the product of democratic institutions that provide stability than its cause (see Cleary and Stokes 2009, Inglehart 1999).

        • Braithwaite, Valerie, and Margaret Levi, eds. 2003. Trust and governance. New York: Russell Sage Foundation.

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          This volume includes papers that examine the role of trust in governance at the organizational and institutional levels. A number of topics are covered, including tax compliance (Scholz), citizen trust in government (Braithwaite), the role of fair and impartial institutions (Levi, Tyler), distrust at the community level in relation to the disadvantaged (Peel), and trust and economic development in China (Whiting), among others.

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        • Cleary, Matthew, and Susan Stokes. 2009. Democracy and the culture of skepticism: Political trust in Argentina and Mexico. New York: Russell Sage Foundation.

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          Investigates linkages between trust and the quality of democratic institutions in Latin America based on case studies of Argentina and Mexico. This is in addition to existing survey data not properly interpreted previously. Their surveys reveal a more complex relationship, indicating that low levels of trust are a symptom of poor government performance rather than a cause. Healthy skepticism is required, not uninformed trust in the absence of fair and impartial institutions.

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        • Hetherington, Marc J. 1998. The political relevance of political trust. American Political Science Review 92.4: 791.

          DOI: 10.2307/2586304Save Citation »Export Citation »E-mail Citation »

          Hetherington notes the marked decline in trust in government from 1964 to 1996. He uses simultaneous equation modeling to create a model of political trust that resolves the issue of endogenous relationships between political trust and dissatisfaction with political leaders and institutions. He shows that political trust has an independent effect on satisfaction with government performance.

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        • Inglehart, Ronald. 1999. Trust, well-being and democracy. In Democracy and trust. Edited by Mark E. Warren, 88–120. Cambridge, UK: Cambridge Univ. Press.

          DOI: 10.1017/CBO9780511659959Save Citation »Export Citation »E-mail Citation »

          Inglehart uses data from multiple surveys to test the relationships between democratic institutions, trust, and welfare. He contends that interpersonal trust is a stable characteristic of societies and is influenced by macro-level factors. His second contention concerns the causal relationship between trust and democracy: while interpersonal trust is found to support democracy, democracy is not found to be a necessary cause of interpersonal trust.

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        • Levi, Margaret, and Laura Stoker. 2000. Political trust and trustworthiness. Annual Review of Political Science 3.1: 475–507.

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          The article is a comprehensive review of research on political trust in the second half of the 20th century, proceeding from a theoretical discussion of the concepts of trust and trustworthiness. Levi and Stoker note the lack of investigation of attitudes toward specific politicians and administrations, while general political trust attitudes are shown to transcend beliefs about specific actors.

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        • Putnam, Robert D., Robert Leonardi, and Raffaella Y. Nanetti. 1993. Making democracy work: Civic traditions in modern Italy. Princeton, NJ: Princeton Univ. Press.

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          This volume is a nuanced study of the conditions under which democratic institutions thrive and are sustained at the local level. Putnam compares twenty regions in northern and southern Italy and proposes an explanation for why industry (and related economic development) thrived in the north and was stagnated in the south of Italy.

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        • Uslaner, Eric M. 2000. Producing and consuming trust. Political Science Quarterly 115.4: 569–590.

          DOI: 10.2307/2657610Save Citation »Export Citation »E-mail Citation »

          Uslaner argues against the view, popularized by Putnam and others, that voluntary associations are associated with trust. His regression analysis shows that only giving to charity and volunteering yields trust, whereas church group involvement produces mistrust. Uslaner proposes two alternate explanations for the observed decline in general trust in the United States: the rise of religious fundamentalism and the increase in economic inequality.

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        LAST MODIFIED: 07/27/2011

        DOI: 10.1093/OBO/9780199756384-0062

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