Magazine article New Statesman (1996)

The Value of Trust

Magazine article New Statesman (1996)

The Value of Trust

Article excerpt

At a time when politicians and bankers are struggling to restore trust, economists are starting to review its importance. "If you take a broad enough definition of trust, then it would explain basically all the difference between the per capita income of the United States and Somalia," said the economist Steve Knack in an interview with Forbes in 2010.

Why is this? For one thing, without trust, it is almost impossible to do business. The simplest exchange becomes fraught with anxiety for whoever hands over the goods. Conducting business with anyone you don't know personally is out, as is any sensible division of labour. Then there's all the extra money you'd have to spend on security.

The UK hasn't quite reached this impasse but it's worrying that trust seems to have taken such a hit and it is important to ask how politicians and financial institutions can win it back.

Trust is seen as a noble trait, complex and hard to win, but a recent study frames it as a fairly simple and selfish phenomenon. According to the study, whether we trust someone is less about our perception of their character and more about whether they are a reliable source of what we want.

A group of researchers led by Brooks King-Casas, Colin Camerer and others investigated the phenomenon using fairly new technology, which allowed subjects to interact with each other while being monitored by brain scanners. Pairs of participants were asked to play a simple game in which, to win the maximum reward, they had to trust each other. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.