1 Department of Economics and Business Economics, Aarhus BSS, Aarhus University2 Université Libre de Bruxelles3 Department of Economics and Business Economics, Aarhus BSS, Aarhus University
We report evidence that trust is the missing root relating education, institutions, and economic development. We observe that more trust both increases education and improves legal and bureaucratic institutions, which in turn spurs economic development. We substantiate this intuition with a series of regressions that provide evidence that trust determines both education and the quality of institutions, and that education and institutions in turn affect GDP per capita.
Public Choice, 2013, Vol 157, Issue 3, p. 641-669
Development; Social trust; Institutions; Education