2014

Trust, Welfare States and Income Equality: Sorting out the Causality

Särtryck nr 2014:43

Författare: Andreas Bergh och Christian BjørnskovÅr: 2014 Publikation: European Journal of Political Economy Årgång (nr): 35 (September) Sidor: 183–199
Artikeln online (behörighet kan krävas)
Preliminär version


The cross-country correlation between social trust and income equality is well documented, but few studies examine the direction of causality. We show theoretically that by facilitating cooperation, trust may lead to more equal outcomes, while the feedback from inequality to trust is ambiguous. Using a structural equation model estimated on a large country sample, we find that trust has a positive effect on both market and net income equality. Larger welfare states lead to higher net equality but neither net income equality nor welfare state size seems to have a causal effect on trust. We conclude that while trust facilitates welfare state policies that may reduce net inequality, this decrease in inequality does not increase trust.


Referens:
Bergh, Andreas och Christian Bjørnskov (2014), "Trust, Welfare States and Income Equality: Sorting out the Causality". European Journal of Political Economy 35(September), 183–199.

Andreas Bergh

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Mobil: 070 779 0734
andreas.bergh@ifn.se

Christian Bjørnskov

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Mobil: +45 20 12 03 84
chbj@econ.au.dk

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