Trust in the Knowledge Society* Eric M. Uslaner Department of Government and Politics University

Trust in the Knowledge Society*

Eric M. Uslaner

Department of Government and Politics

University of Maryland–College Park

College Park, MD 20742

[email protected]

Prepared for the Conference on Social Capital, Cabinet of the Government of Japan, March 24-

25, Tokyo, Japan.

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A bond of trust lets us put greater confidence in other people’s promises that they mean

what they say when they promise to cooperate. The “standard” account of trust presumes that

trust depends on information and experience. Offe (1999) states: “Trust in persons results from

past experience with concrete persons.”

If two people do not know each other, they would have no basis for trusting each other.

Moreover, a single encounter will not suffice to develop trust. Even when they get to know each

other better, their mutual trust will be limited to what they know about each other.

The decision to trust another person is essentially strategic. Strategic (or knowledge-

based) trust presupposes risk (Misztal, 1996, 18; A. Seligman, 1997, 63). Trust helps us solve

collective action problems by reducing transaction costs–the price of gaining the requisite

information that people need to place confidence in each other (Putnam, 1993, 172; Offe, 1996,

27). It is a recipe for telling us when we can tell whether other people are trustworthy (Luhmann,

1979, 43).1

Beyond the strategic view of trust is another perspective. Moralistic trust is a moral

commandment to treat people as if they were trustworthy. The central idea behind moralistic

trust is the belief that most people share your fundamental moral values (cf. Fukayama, 1995,

153). Moralistic trust is based upon “some sort of belief in the goodwill of the other” (A.

Seligman, 1997, 43; cf. Mansbridge, 1999; Yamigishi and Yamigishi, 1994, 131).

Strategic trust cannot answer why people get involved in their communities. The linkage

with moralistic trust is much more straightforward. Strategic trust can only lead to cooperation

among people you have gotten to know, so it can only resolve problems of trust among small

numbers of people. We need moralistic trust to get to civic engagement and to other benefits of

faith in others. Moralistic trust is important for the knowledge-based society: It leads to greater

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tolerance for groups that have historically faced discrimination. It leads to more tolerant

attitudes toward immigrants–and to greater support for open markets. And beyond people’s

attitudes, moralistic trust has consequences for public policy: Nations that rank higher on trust

have more open economies, higher rates of economic growth, better functioning governments,

less corruption, and are more likely to have activist governments. Trusting nations prosper

because they are the forefront of globalization. They are the pioneers in the knowledge-based

economy.

Trust is generally considered to be part of a larger concept of “social capital.” Social

capital has been defined to include trust, norms of reciprocity, and networks of civic engagement

(Putnam, 1993, 180). Each of the components of social capital is said to produce cooperation

within society. I have argued that trust does indeed lead to greater cooperation. However,

membership in voluntary associations (the most widely used measure of networks of civic

engagement) do not promote cooperation and economic growth in the same way as trust. All

sorts of people join civic groups and there is little evidence that group membership leads to

greater trust. There may be other benefits from joining civic groups. But the key to better

government, more tolerance, and greater economic growth is through trust, not civic engagement.

The Varieties of Trust

Moralistic trust is a value that rests on an optimistic view of the world and one’s ability to

control it. Moralistic trust is not a relationship between specific persons for a particular context.

Strategic trust reflects our expectations about how people will behave. Moralistic trus t is

a statement about how people should behave. People ought to trust each other. The Golden

Rule (which is the foundation of moralistic trust) does not demand that you do unto others as

they do unto you. Instead, you do unto others as you would have them do unto you. Moral

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dictates are absolutes (usually with some exceptions in extreme circumstances). Moralistic

trusters believe that the world is a benign place, that other people are generally well motivated,

and that they are part of the same moral community, even if (or especially if) they are of

different backgrounds and beliefs. Such beliefs ease the way toward getting people to work

together to make their communities (and the larger society) a better place. Mistrusters view

dealing with strangers as taking big risks. Trusters see expanding their horizons as great

opportunities.

Strategic trust is not predicated upon a negative view of the world, but rather upon

uncertainty. Levi (1997, 3) argues: “The opposite of trust is not distrust; it is the lack of trust”

(cf. Hardin, 1992, 154). But moralistic trust must have positive feelings at one pole and

negative ones at the other. It would be strange to have a moral code with good juxtaposed

against undecided.

Beyond the distinction between moralistic and strategic trust is the continuum from

particularized to generalized trust. Generalized trust is the perception that most people are part

of your moral community. The difference between generalized and particularized trust is similar

to the distinction Putnam (2000, 22) drew between “bonding” and “bridging” social capital.

Yamigishi and Yamigishi (1994) formulated this distinction: Generalized trust is trust in people

who are different from yourself. Particularized trust is faith in people who are like yourself.

Yamigishi and Yamigishi conducted surveys of Americans and Japanese and found that Japanese

rank higher on particularized trust and Americans on generalized trust.

While I have pictured particularized and generalized trusts as parts of a continuum,

reality is a bit more complex. Generalized trusters don’t dislike their own kind. Generalized

trusters don’t abjure contacts with people like themselves. Indeed, much of civic life revolves

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around contact with people like ourselves. Consider two of the civic associations that have

played such a key role in Putnam’s (1993, 2000) discussion of social capital: bowling leagues

and choral societies. Bowling leagues are composed of people who like to bowl and choral

societies are made up of people who like classical music.2 We are simply unlikely to meet

people who are different from ourselves in our civic life. Now, choral societies and bird-

watching groups (among others that Putnam discusses) will hardly destroy trust. And there is

nothing wrong with such narrow groups. They bring lots of joy to their members and don’t harm

anybody. But they are poor candidates for creating social trust (Rosenblum, 1998).

And you are not likely to get trust in people you don’t know from most of civic life.

Stolle (1998, 500) argues that the extension of trust from your own group to the larger society

occurs through “mechanisms not yet clearly understood.” An even more skeptical Rosenblum

(1998, 45, 48) calls the purported link “an airy ‘liberal expectancy’” that remains “unexplained.”

Stolle and Rosenblum challenge the idea that we learn to trust people we don’t know by

observing people we do know. Stolle (1998) finds that the longer membership in voluntary

associations is associated with more particularized trust (faith in other group members), not

with more generalized trust (faith in strangers).

Trust is a modern concept, of key importance to the knowledge-based society. Putnam

(1993, 88, 174) argues that trust will not develop in a highly stratified society. And Seligman

(1997, 36-37, 41) goes further. Trust can not take root in a hierarchal culture. Such societies

have rigid social orders marked by strong class divisions that persist across generations. Feudal

systems and societies based on castes dictate what people can and can not do based upon the

circumstances of their birth. Social relations are based on expectations of what people must do,

not on their talents or personalities. Trust is not the lubricant of cooperation in such traditional

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societies. The assumption that others share your beliefs is counterintuitive, since strict class

divisions make it unlikely that others actually have the same values as people in other classes.

In earlier days, when generalized trust was scarce, particularized trust (in people of your

own background) helped cement business deals in a world where any sort of trust seemed highly

risky (Greif, 1993). In the modern knowledge-based society, trust helps us make deals with

people we do not know. Macauley (1963), writing at a time of high trust in American society,

argued that in modern society, people make business deals based upon handshakes rather than

contracts. We do not build trust by relying on the law to enforce contracts or to put wrongdoers

in jail. Yes, we do punish people who violate the law and we do enforce contracts. But resorting

too often to the strong arm of the law may undermine trust, rather than build it up. Coercion,

Gambetta (1988, 220) argues, “falls short of being an adequate alternative to trust....It introduce

an asymmetry which disposes of mutual trust and promotes instead power and resentment.”

Strategic and moralistic trust have very different foundations. We don’t form moralistic

trust on experiences–so no amount of social interaction is likely to reshape our values. This is

not to say that trust is immutable and that we can’t learn to have faith in others even as adults.

But our civic life is not likely to be the place where we change our fundamental values: Most

people spend minuscule amounts of time in voluntary organizations and even the most

committed activists rarely devote more than a few hours a week to group life–hardly enough

time to shape, or reshape, an adult’s values (Newton, 1997, 579).

The roots of moralistic trust are a sense of optimism and control: The world is a good

place, it is going to get better, and you can help make it a better place. We “learn” moralistic

trust early in life, mostly from our parents–though also from our schools. Our early experiences

have the greatest impact on our sense of moralistic trust, and once we become a truster (or

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mistruster), we are not likely to change as an adult. Most personal experiences such as joining

civic clubs doesn’t matter for trust. But some experiences do matter mightily: More highly

educated people are far more trusting and college education is especially important.

The belief in personal control is very much part of the modern knowledge society. In the

past when societies were more hierarchical, there was little chance for people to shape their own

fates. Instead, their lives were ruled by forces beyond their control. In contemporary surveys,

we see that people who believe that their fates are controlled from outside are far less likely to

trust other people. At least in the United States, a fascinating indicator of control of our

environment is confidence in science. The more confidence people have in science, the more

trusting they are.

Big events in a society also matter very much: In the United States, the Vietnam War of

the 1960s and 1970s was associated with a decline in trust as young people chanted, “Don’t trust

anyone over 30.” Opponents of the war were far more likely to become mistrusters than

supporters. But the civ il rights movement in the United States was associated with greater trust

in people unlike yourself (Uslaner, 2002, ch. 6). In Sweden, labor peace after years of strife

seems to have led to a societal increase in moralistic trust (Rothstein, 2000).

The most important collective experience shaping trust is the level of economic equality

in a society. Both in the United States over time and across countries without a legacy of

Communism, the most important factor shaping trust in people is the level of economic equality

(see Figure 1).

_________________

Figure 1 about here

Equality promotes trust in two ways. First, a more equitable distribution of income

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makes

people with less more optimistic that they too can share in society’s bounty. And optimism is the

basis of trust. Second, a more equitable distribution of income creates stronger bonds between

different groups in society. When some people have far more than others, neither those at the

top nor those at the bottom are likely to consider the other as part of their “moral community.”

They do not perceive a shared fate with others in society. Hence, they are less likely to trust

people who may be different from themselves.

Why and How Trust Matters

We measure trust by the “standard” survey question: “Generally speaking, do you believe

that most people can be trusted, or can’t you be too careful in dealing with people?” This

question has been asked in surveys for more than four decades, most notably in the World

Values Survey (cross-nationally) and in the General Social Survey and American National

Election Studies in the United States, where we have the longest time series on trust. While the

question is controversial, elsewhere I provide strong support for its use–and for the claims that it

represents both generalized trust (rather than strategic trust or particularized trust) and

moralistic trust (Uslaner, 2002, ch. 3).

There is a presumption that trust and civic engagement are intrically connected. Putnam

(2000, 137) wrote:

...people who trust others are all-around good citizens, and those more engaged in

community life are both more trusting and more trustworthy....the critically

disengaged believe themselves to be surrounded by miscreants and feel less

constrained to be honest themselves. The causal arrows among civic involvement,

reciprocity, honesty, and social trust are as tangled as well-tossed spaghetti.

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The evidence for any link, much less a reciprocal link (trust 6civic engagement 6 trust), is

weak. Most forms of civic engagement neither produce nor consume trust. But the more

demanding forms, those that really tie us to people unlike ourselves, both depend upon

generalized trust and reinforce it. In Uslaner (2002, ch. 5), I use data from a variety of surveys

in the United States to investigate the reciprocal linkages between trust and civic engagement.3

These estimations show that Putnam’s “virtuous circle” is at most a “virtuous arrow.” Where

there are significant relationships between trust and civic engagement, almost all of the time, the

causal direction goes from trust to civic engagement rather than the other way around. Even

these results are based upon a presumption that the causal arrow usually goes somewhere. Some

social connections might even reinforce particularized rather than generalized trust. Much of the

time social networks, both informal and formal, are moral dead ends. They neither consume nor

produce trust. They just happen.

This is certainly true of all forms of informal social ties, ranging from playing cards to

joining choral societies to going to bars, restaurants, or bingo parlors. Our social ties are with

people like ourselves and do not (dare I say “cannot”) lead to trust in strangers. People who play

cards have more faith in their neighbors–the people they play with–but not in strangers. There is

some evidence that trusters are more likely to talk to more neighbors–but they are less likely to

see their best friends often and less likely to spend a lot of time with parents and relatives. They

are no more likely to go to parades, sports events, or art shows often; spend a lot of time with

friends from work or simply to hang out with friends in a public place; visit chat rooms on the

World Wide Web a lot, or even to play lots of team sports. People who trust folks they know–

their neighbors–are more likely to go to parades and join sports teams frequently. But overall,

the major reason why people socialize a lot is that they have many friends, not that they trust

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strangers. Misanthropes have friends too. Nor is there any evidence that these activities produce

generalized trust.

Joining civic groups, for the most part, is not linked to trust either. Of 20 types of civic

groups included in the 1996 American National Election Study, my analysis showed that: (1) no

group membership led to trust; and (2) trust only had significant effects on four types of group

membership. Generalized trusters are more likely to join business and cultural organizations, but

less likely to belong to ethnic and church groups. And this makes sense: Ethnic associations

reinforce in-group ties, as do some religious ties.

There are also very weak (and insignificant) ties between trust and political engagement.

And this is not surprising either. Politics is often confrontational. It thrives on mistrust (Warren,

1996). Trust in strangers brings forth a very different disposition, a desire to cooperate and work

with others.

Generalized trust matters because it helps connect us to people who are different from

ourselves. Generalized trusters are tolerant of immigrants and minorities and support equal

rights for women and gays. They believe in a common core of values and hold that ethnic

politicians should not represent only their own kind.

Trust matters for the type of civic activities that tap this sentiment of reaching out to

people who are different from ourselves–and to helping them. Where faith in others matters

most is in volunteering and giving to charity. And not just for any type of volunteering or giving

to charity. If I volunteer at my son’s school or give to my house of worship (or other religious

cause), I am strengthening in-group ties. Christian fundamentalists are a far more important

group in the United States than outside it.4 When Christian fundamentalists join voluntary

organizations or give time to others, they almost exclusively associate with those who share their

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faith. They do not reach out to people who think differently. Indeed, religious volunteering and

giving to charity is the mark of particularized trust. Giving time or money to secular causes,

where we are more likely to help people who are different from ourselves, is the hallmark of

generalized trusters (Uslaner, 2001, 2002, ch. 7. Wuthnow, 1999). Giving to charity and

volunteering time depend upon trust, but they also create it. Doing good deeds produces a

“warm glow” in the people who help others (Andreoni, 1989). So trusting people have even

more faith in strangers when they do good works.

These findings are not unique to the United States. In work with Gabriel Badescu and

Paul Sum (Badescu, Sum, and Uslaner, 2003), we have found that volunteers in Romania and the

Republic of Molodova are more trusting and tolerant than the mass public or group members.

Generalized trust, then, leads to taking risks. When we interact with strangers, we don’t

have information about them, especially when their backgrounds are different from ours. The

optimistic world view underlying trust minimizes our concern for risk. We look at strangers as

opportunities to develop new horizons.

Not all trust is the same and not all civic activity is the same. Some forms of civic

engagement may lead to more in-group trust and less trust in people who are different from

ourselves (cf. Berman, 1997; and Roßteutscher, 2002 ). Trusting your own kind may be part of

a more general positive syndrome of faith in others or it may inhibit generalized faith in others.

Trusting people you know does not lead to trust in strangers. Loving my wife and son will not

make me better disposed toward the men who haul away my garbage.5 We need strategic trust to

make do in our daily lives: Should I trust the contractor who proposes to rewire my house? How

do I find an honest mechanic? The type of trust that matters for policy-makers is moralistic trust,

and no amount of particularized trust will make you a moralistic truster.

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The Benefits of Trust Across Nations

I have shown that generalized trust makes people more likely to be tolerant and to

support open markets. Is there evidence that these values, as expressed in surveys mostly

conducted in the United States, have policy implications?

Yes! I have computed the shares of publics who believe that “most people can be

trusted” largely from the World Values Surveys (but also from the International Social Survey

Program) and show that countries with higher levels of trust have more open markets, more

globalization overall, higher growth rates, and less corruption. They also spend more on social

programs. And then I show that this is not just because democracies are more trusting or because

people belong to a wide range of civic groups.

In more than one way, trust makes democracies rich. The first link is indirect. Because

trust reflects sentiments toward people who are different from ourselves, it makes it easier for

societies to reach out and deal with other countries. Trusters favor free trade. And trusting

societies are more willing to reach out to outsiders: High trust goes hand-in-hand with open

economies and fewer restrictions on trade, which in turn leads to greater prosperity (cf.

Woolcock, 1998, 158).

There is a clear relationship between the level of trust in a society and how open its

markets are. The most trusting countries (the Nordic nations and the Netherlands) have the most

open economies. The least trusting countries (Brazil, the Phillipines, Peru, Colombia, and

Turkey) are most likely to close their markets (see Figure 2). The statistical relationship is

moderate (as we can see by the fit of the points to the line in the graph).

Much stronger is the overall connection between trust and globalization. Here I use a

composite index of globalization computed by the A.T. Kearney research firm for Foreign Policy

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magazine in 2001. The index includes goods and services imported and exported, foreign direct

investment, embassies, international organization memberships, United Nations security

memberships, the internationalization of stock portfolios, internet users, telephone calls in and

out of the country, and tourists both in and out of the country. The connection between

globalization and trust is strong. Since several of the components of the index tap a country’s

wealth (tourists, stock portfolios, internet usage, telephone calls), we might wonder if the

connection between trust and globalization might be illusory.

Maybe trusting societies are more globalized because both globalized and trusting

countries are well off. Or maybe both trusting and globalized countries have “cleaner”

governments, where businesses don’t have to make pay-offs so often. Or maybe it is simply that

free governments are more likely to be both globalized and trusting. Yet the connection between

trust and globalization remains powerful even when I add statistical controls for the income

(adjusted for per capita purchasing power), the extent of corruption in a country, and the level of

political freedom. Trusting societies invest more in globalization (see Figure 3). When people

trust strangers, they reach out to them in a wide variety of ways: They trade with other nations,

visit other countries, and communicate with them by telephone and the Internet. The connection

between Internet usage and trust in people across nations is very powerful.

Most economists believe that globalized economies, and especially open markets, bring

economic growth. So we would expect that trusting societies would have higher levels of

economic growth (see LaPorta et al., 1997, 1998). And this is what I find in Figure 5. Again,

the relationship is moderate, but the overall pattern is clear.6 Even beyond the level of prosperity

(wealthier countries have higher growth rates), trust leads to greater prosperity.

______________________

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Figures 2, 3, 4, 5 about here

Putnam (1993, 176) is correct when he argues that trust in people leads to better

government performance. Trusting countries are less corrupt than countries with many

mistrusters. Trust is the cornerstone of a cooperative spirit. It is the moral sentiment that points

to what we have in common with each other. Corruption is an expression of selfishness. Trust

leads us to give of ourselves, in both time (volunteering) and money (giving to charity).

Corruption involves expropriating what rightfully belongs to others. Trust rests on a foundation

of openness–accepting others for what they are, rather than for what you would like them to be.

Transparency is the enemy of corruption. Kleptocracy, government by thieves, rests on hiding

stolen assets and maintaining monopolistic control of the polity to ensure that no do-gooder can

trace where the money went. Trust and corruption rest upon fundamentally different views of

human nature. Trust is based upon an optimistic view of the world. Corruption rests on a

diametrically opposed view of human nature: We rob because we value creature comforts.

So it is hardly surprising that the relationship between trust and corruption is powerful:

Where trust is high, corruption is low (see Figure 6). I use the Transparency International 2001

estimates of corruption, where higher scores indicate less corruption. Trusting societies are less

corrupt and have better government performance. Trust has powerful effects on corruption (cf.

LaPorta et al., 1997). Theoretically, if you could make Chile as trusting as Denmark, it would

also be as clean as this least corrupt country in the world. The effect of trust on corruption is

almost one and half times as large as the next most important predictor, the average number of

school years completed. We might suspect that corruption has a greater impact on trust than

faith in others has on robbing the public purse. But it doesn’t. Kleptocracies thrive in low-trust

societies. They can’t get off the ground when most people trust each other.

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_________________

Figure 6 about here

Countries with high levels of trust also have better performing bureaucracies (less “red

tape”) and more “efficient” judicial systems, as well as more people who trust the legal system

(cf. LaPorta et al., 1997, 335-336; Uslaner, 2002, ch. 8). An efficient judicial system (Rothstein,

2000) depends upon an underlying foundation of social trust. And, once again, good judges

don’t make good citizens.

In each case, statistical analyses reported in Uslaner (2002, ch. 8) indicate that the

relationships go from t to good government, not the other way around. Countries with efficient

judicial systems don’t become more trusting. The link from trust to judicial efficacy is strong

and powerful, whereas the link in the opposite direction is insignificant with an incorrect sign.

Trust depends upon economic equality–and it leads to even more equality. Trusting

societies have bigger governments that redistribute wealth from the rich to the poor, spend more

on education, and pursue policies that will stimulate economic growth (see Uslaner, 2002, ch. 8

for the technical details). In Figures 7 and 8, I show moderately strong relationships between

the level of t rust, on the one hand, and per capita spending on education and transfer payments

from the rich to the poor, on the other hand.

____________________

Figures 7 and 8 about here

While there is no direct connection from trust to economic equality, trusting societies in

democratic regimes pursue programs that indirectly will boost faith in others. Trusting nations

spend a more of their total income on governmental programs in general and on education in

particular. They also have a larger share of their total population employed by the government

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(Uslaner, 2002, ch. 8). In particular, trusting societies are more likely to devote a higher share of

their national wealth to transfer programs that assist the least advantaged.

Governments that redistribute income, spend money on education, transfer wealth from

rich to poor, have large public sectors, and maintain open economies do not generate trust. Trust

seems to come first. Well, almost. Economic equality is a strong determinant of trust. And trust

leads to policies that create wealth and reduce inequalities.

Here we find what Putnam would call a “virtuous circle.” The equal become more equal.

Yet, there is also a vicious circle: Misanthropy and inequality feed on themselves. Yes, you can

increase trust indirectly by pursuing policies that reduce economic inequality: Each of the public

policies I have considered leads to more economic equality, though the correlations are moderate

except for one, for the openness of the economy. 7 And, yes, you can adopt these policies without

a trusting citizenry. But a public that is public spirited gives some countries advantages over

others in reducing inequality and boosting trust.

Is trust really the key to a better government or is trust simply a surrogate for democracy

or participatory societies? Muller and Seligman (1994) and Inglehart (1999) both see democracy

and trust as closely intertwined. Muller and Seligman see democratic regimes as the source of

trust (see also Levi, 1998), while Inglehart argues that trust is the foundation of the modern

democratic state. Yet, trust is not a prequisite, much less a consequence, of democracy.

Democracies may be trusting or mistrusting. In countries with no legacy of Communist

rule, the mean proportion of trusters in highly democratic regimes is .411, compared to .217 in

the formerly Communist regimes. Democracies are all over the place in trust, ranging from .03

(Brazil) to .65 (Norway). Formerly Communist regimes also vary in trust, but only from .06

to .34. Half of all democracies have more than 34 percent trusters. The standard deviation for

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democracies is .151. It is less than half that value (.062) for authoritarian states. Democracies

make trust possible. They don’t necessarily produce it. Totalitarian governments make trust

implausible, though not impossible.

Democracies have higher levels of trust because authoritarian states have lower levels of

trust. Democratic constitutions provide little guarantee–or even likelihood–of enhancing trust.

Yes, they can maintain order better because people believe that law enforcement is fair. And,

yes, democratic governments are almost assuredly more popular (and thus more trusted) than

dictatorships. But trust in the legal system or in government more generally is not the same as

faith in other people. Even in high trusting countries such as Sweden, there is only modest

support for the claim that people who have faith in the legal system also trust others (Rothstein,

2000).

There is certainly little evidence that democratization increases trust. The correlation

between change in trust in 22 nations from 1981 to the early 1990s (according to the World

Values Survey) and variations in Freedom House scores from 1978 to 1988 is effectively zero.

The democratic march to trust is a long and winding road. It takes 46 years of continuous

democracy to move a country from well below the mean on trust to above it. Countries with less

than 46 years of continuous democracy are no more likely to have trusting citizens than

authoritarian states. Of the eight Eastern bloc countries for which we have measurements on trust

in 1990 and 1995-96, only one nation had an increase in faith in others (Latvia, six percent),

while seven had decreases, four of which were substantial. The constitutions of Eastern and

Central European nations have become increasingly democratic over time. As democratization

proceeded apace, trust lagged behind and the correlation between trust and democratization

became increasingly (and significantly) negative.

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So it should hardly be surprising to find at best a weak relationship between trust and the

level of democracy (using the Polity III measure of democracy) in Figure 9. I could easily

substitute another measure of democracy–and the results would be very much the same. There is,

then, a difference between “making democracy” and (in Putnam’s apt terminology) “making

democracy work.” Anyone can design a democratic constitution, as we have seen in Central and

Eastern Europe since 1989. It takes trust to make democracy function well. An Indian journalist

commented on the sharp cleavages that led to a cycle of unstable coalitions, none of which could

form a government: “We have the hardware of democracy, but not the software, and that can’t be

borrowed or mimicked” (Constable, 1999, A19).

Nor is there much evidence that trust is simply another name for postmaterialist values.

Across a wide range of societies, both traditionally democratic and former Communist nations,

there is little relationship between the average position on the postmaterialism scale in the World

Values Surveys and the level of trust in people. The most trusting societies range from

materialist Norway to postmaterialist Netherlands. Among the lowest trust countries, Brazil is

very materialist, but Turkey is even more postmaterialist than Denmark and not much different

from Sweden (see Figure 10).

While this may seem counterintuitive initially, we must realize that postmaterialists are in

many ways different from trusters. Trust promotes cooperation. Postmaterialists may favor a

peaceable world, but their politics are often confrontational. In the combined World Values

Surveys samples, 34 percent of postmaterialists (compared to 13 percent of materialists) say that

they have attended a demonstration and 75 percent said they either had gone to a protest or might

do so (compared to 46 percent of materialists). Thirty one percent of postmaterialists said that

they either had occupied a building or might do so, compared to 10 percent of materialists.

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People who trust others are slightly more likely to have attended demonstrations (23 percent to

14 percent for mistrusters) and barely different from mistrusters to say that they might occupy

buildings (by 18 percent to 14 percent). Postmaterialists are less cooperative than trus ters.

. ____________________


Finally, I return to globalization and economic growth and consider the other key

component of social capital, group membership. Earlier I showed that trusting countries are

more global (strong relationship) and have higher growth rates (moderate relationship). In

Figures 11 and 12, there is no clear relationship between total secular organization membership

across nations and either globalization or growth. It is trust that matters, not group membership.

And this should not be surprising: When we join groups, we encounter people very much like

ourselves. There is little reason to believe that membership in civic groups will make us more

open to trading with people who are different from ourselves. Generalized trust, on the other

hand, is all about interacting with people who are different from yourself.

________________________


Policy Implications

Decision-makers in many countries and international agencies, including the United

States and the World Bank, believe that social capital can lead to better communities. They are

trying to get people involved in their communities in the hope and expectation that daily life and

public life will become better. There is a widespread belief that increasing social capital will

lead to more prosperous communities, as well as happier ones. Much of this effort seems to me

to be misplaced. There is much we can do, but I am not sure that we are clear in what we are

19

doing.

Local communities are trying to stimulate public participation. The World Bank has been

very active in promoting civic participation in poor countries. And American communities have

been promoting civic engagement as well.

Yet, as we have known since Verba and Nie (1972), not all civic engagement is of one

piece. Verba and Nie distinguish between political and communal activity. There is plenty of

evidence over more than one century that political engagement can make government more

responsive. This is, after all, what democracy is all about. Much of the literature on

representative institutions, elections, and interest groups focuses on how we can measure the

influence that ordinary citizens have on their governments. We know that not all political

activity is effective, but we also know that citizen action can make government more responsive

to the public. Yet, this is not what most of the discussion of social capital is all about. Political

activity is largely confrontational. Even if our tactics are gentle, politics is about winners and

losers. Social capital is about cooperation, where everyone supposedly wins. Someone has to

lose an election. And if democratic politics is all about a competition of ideas, there is nothing

wrong (or even bad) about having winners and losers–as long as we do not get too

confrontational about it.

Social capital as public policy goes awry in three ways. First, it presumes that all sorts of

group activity can lead to social cooperation. This is simply false. Most communal activity–

joining bowling leagues or choral societies or model airplane clubs, or having dinner parties or

going to the neighborhood pub–are what I have called “moral dead ends.” They may be fine

ways to connect with friends, but they have no larger social purpose. We expect too much of a

good thing (social ties). There is little reason to believe that getting together with people very

20

much like yourself will have broader consequences than a pleasant evening (and, if it doesn’t,

that’s quite all right).

Second, we may confuse the cause with the effect. The American national government is

trying to stimulate volunteering through the USA Freedom Corps (see

http://www.freedomcorps.gov/about_usafc/whats_new/announcements/20021218-1.asp ).

Get people involved in our communities and they will be a better place. Yes, that makes sense.

Volunteering has two fundamental roots: (1) a sense of moral obligation that stems from

generalized trust; and (2) religious values and ties. Much of the volunteering efforts stem from

the (correct) belief that good works will make us more trusting. However, to get a boost in trust

from volunteering, you generally need trusting people to begin with. Most programs to get

people involved in their communities have not paid sufficient attention to how we can motivate

people to do good works. Many school programs mandate volunteering. Yet, there is little

evidence to support the claim that mandatory volunteering will make young people any more

trusting or tolerant (Niemi, Hepburn, and Chapman, 1999) or even more likely to volunteer as

adults (John et al., 2001, 23). Religious volunteering does have deeper roots and they are most

profound among fundamentalists. Yet, fundamentalists will volunteer, as noted above, only

within their own communities. So the larger social benefits of this altruistic behavior will not be

achieved.

Third, our concern with civic engagement rat her than trust has taken our focus away from

the steps we need to build trust. We need to consider policies that will reduce economic

inequality. This is not simply an ideological agenda. Politicians on both the left and the right in

the United States have recognized that increasing inequality has torn away at America’s social

fabric. How to remedy this situation is a difficult question and different leaders have different

21

solutions. But it is important to bring the question of inequality to the forefront of the debate on

social capital.

We must also recognize the importance of values taught early in life and the opportunities

young people have to interact with different backgrounds. Young people who have friends of a

different race in the United States are much more likely to become trusters as adults. Yet adults

who have friends of a different race are no more likely to be trusters (Uslaner, 2002, ch. 6). Early

experiences are far more important than those later in life. We also know that education makes

people more tolerant and trusting. So policies that ensure that many young people are able to

gain entrance to universities can help build trust.

The Promise of Social Capital for the Japanese Society and Economy

In most of the graphs I have presented, Japan ranks above average, sometimes

considerably above average. So Japan has many advantages that other countries do not. But

every country wants to do better and the data suggest that there is room for improvement in

Japan’s social capital, that would promote economic growth and globalization.

On trust, Japan ranks 18th out of 82 countries for which I have data. It ranks higher than

the United States, Italy, Switzerland, Austria, and Belgium, though considerably below the

Nordic nations. On membership in voluntary associations, Japan ranks lower: 38th out of 53

nations (about the same level as India). Its economy is among the most open in the world, but its

overall globalization score is more modest (25th out of 39 countries).

In today’s knowledge society, Japan is well situated to face the challenge of technology:

It ranks 11th of 62 countries for users of the Internet and 12th out of 59 for average number of

school years, and 4th out of 68 countries in university students.

There are some challenges that Japan faces. While its economy is formally very open,

22

the share of its economy devoted to trade in goods and services (according to World Bank data)

ranks 61st out of 62 countries (according to A.T. Kearney data). Japan’s external trade is far

closer to those of low-trusting societies such as Argentina and Brazil (and the moderately low

trusting society of the United States) than to the higher trusting societies such as the Netherlands

and Ireland. One challenge to Japan is to open its markets further, to take advantage of its

moderately high level of trust.

A second challenge that Japan might consider is to strive for greater economic equality.

Japan ranks 40th of 64 countries in the level of economic equality. Among countries without a

legacy of Communism, it ranks 25th out of 41. If the path to greater trust (and greater prosperity)

is through economic equality, Japan should put greater emphasis on equalizing resources

between the rich and the poor. Reducing inequality does not require a massive redistribution

from the rich to the poor. It does entail directing resources more equally. Japan ranks 27th of 39

countries in transfer payments from the rich to the poor , 24th out of 44 countries in education

spending as a share of gross domestic product, and 36th of 43 countries in overall spending on

government as a share of gross domestic product. In each case except for education spending,

Japan spends less than other countries with similar levels of trust. If trust were higher, Japan

would spend more on these programs that directly reduce economic inequality.

A third challenge Japan might consider is to increase its level of generalized trust. One

way to do this is to reduce economic inequality. Yet, if Yamigishi and Yamigishi (1994) are

correct, it is also important to increase out-group trust much more than in-group trust. The social

ties among business associates that are so important to making deals in Japan (and elsewhere) are

very useful. They may be even more important than formal contracts, which require the strong

arm of the law. Yet, business transactions among people in the same society and of the same

23

background is not sufficient to produce long-term prosperity, Woolcock (1998) argues. Trust in

people of different backgrounds leads to greater tolerance and to taking the risks involved in

trading with strangers. In Japan, according to the World Values Study data, trusters are twice as

likely as mistrusters to accept people of different races and immigrants as neighbors. Schools

might encourage children to interact with other youngsters of different backgrounds, since we

know that young people who have friends of different backgrounds are more likely to become

trusters. A more trusting society will promote economic equality through governmental

programs and open markets, which in turn will lead to greater economic growth.

Japan has quite a bit of social capital. The low rate of participation in voluntary

associations should not concern her, since this form of social capital is less important for risk

taking than is trust. But it can use more—and seeking greater economic equality and

interaction among young people of different backgrounds might be the best way to increase

generalized trust.

24

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28

Figure 1

ARG

AUS

ASTBEL

BRZ

UK

CAN

CHL

COL

CYP

DEN

DOM

FIN

FRA

GHA

GRE

IND

IRE

ISR

ITA

JPN

LUXMEX

HOL

NZ

NIG

NOR

PRU

PHL

POR

SAF

SKRSPN

SWE

SWZ

TAI

TUR

USA

URU

VNZ

WGR

0.2

.4.6

Mos

t Peo

ple

Can

Be

Tru

sted

.2 .3 .4 .5 .6Gini index economic inequality

r2 = .391

Former and Current Communist Nations ExcludedTrust in People and Economic Inequality

As economic inequality increases, a country’s level of trust declines.

29

Figure 2

ARG

AST

BNG

BEL

BRZ

UK

CAN

CHLCOL

DEN

FINFRA

GHA

GRE

IND

IRE

ITA

JPNMEX

HOL

NIG

NOR

PRU

PHL

POR

SKRSPN

SWE

SWZ

TAI

TUR

USA

URU

WGR

.1.2

.3.4

Bar

ro In

dex

of O

pen

Eco

nom

y

0 .2 .4 .6Most People Can Be Trusted, World Values Surveys and Intl Social Survey Program

Source: Barro and Lee, 'Data Set for a Panel of 138 Countries,' Harvard University, r2 =.315

Former and Current Communist Nations ExcludedOpen Markets and Trust in People

As a country’s level of trust increases, it is more likely to have open markets.

30

Figure 3

ARG

AUS

AST

BRZ

UKCAN

CHL

COL

DEN

FIN

FRA

GRE

IND

IRE

ITA

JPNMEX

HOL

NIG

NOR

PRU

PHL

POR

SAFSKR

SPN

SWE

SWZ

TUR

USA

VNZ

WGR

02

46

For

eign

Pol

icy

Glo

baliz

atio

n In

dex


Source: Foreign Policy index of globalization r2 =.531

Former and Current Communist Nations ExcludedGlobalization and Trust in People

Countries with higher levels of trust are more likely to rank highly on globalization.

31

Figure 4

RUSBRZ

COL UKRARG

SAF

CZK

HUNROM

SLV

POLPOR

PHL

ITA

CRO

SPN

IND

JPN

SLO

HOL

FIN

AST

WGR

SWE

FRA

UK

SWZ

USA

NOR

DEN

CAN

TUR

PRU BNG

TAI

GRE

SKRIRE

MEX

ARM

NIG

CHLVNZ

0.1

.2.3

.4.5

Inte

rnet

Use

rs a

s S

hare

of P

opul

atio

n, A

.T. K

earn

y

0 .2 .4 .6Most People Can Be Trusted

A.T. Kearney, Foreign Policy, r2 =.599

Internet Users as Share of Population and Trust in People

Countries with higher levels of trust have more people who use the Internet.

32

Figure 5

ARG

AUS

AST BEL

BRZ

UKCAN

CHL

COLDEN

DOM

FIN

FRA

GHA

GRE

ICE

IND

IRE

ITA

JPN

LUX

MEX

HOL

NIG

NOR

PRUPHL

POR

SAF

SKR

SPN SWESWZ

TUR USA

URUVNZ

WGR

010

020

030

0R

eal G

row

th R

ate


Source: Penn World Tables, r2 =.300

Former and Current Communist Nations ExcludedReal Growth Rate 1980s and Trust in People

Countries with higher levels of trust have greater economic growth.

33

Figure 6

ARG

AUS

AST

BLR

BEL

BRZ

UK

BUL

CAN

CHL

CHN

COL

CZK

DEN

EST

FIN

FRA

GHA

GREHUN

ICE

IND

IRE

ITA

JPN

LAT

LUX

MEX

HOL

NIG

NOR

PRU

PHL

POL

POR

ROM

RUS

SAF

SKRSLV

SPN

SWESWZ

TAI

TUR

USA

UKR

URU

VNZ

WGR

02

46

8TI

Cor

rupt

ion

Inde

x 19

98


Source: Transparency International Corruption Perceptions Index, 1998, r2 =.469

Level of Corruption and Trust in People

Countries with higher levels of trust have lower levels of corruption.

34

Figure 7

AUS

AST

BNG

BEL

BRZ

UK

CAN

CHL

COL

DEN

FINFRA

GHAGRE

ICE

IND

IRE

ITA

JPN

LUX

MEX

HOL

NOR

PHL

POR

SKR

SPN

SWE

SWZ

USA

URU

VNZ

WGR

24

68

Edu

catio

n S

pend

ing

Per

Cap

ita


Source: Rafael LaPorta, Harvard University, r2 =.419

Former and Current Communist Nations ExcludedEducation Spending and Trust in People

Countries with higher levels of trust spend more per capita on education.

35

Figure 8

ARGAUS

AST

BEL

BRZ

UK

CAN

CHL

COL

DEN

DOM

FIN

FRA

GHA

ICE

IND

IRE

ITA

JPN

MEX

HOL

NIG

NOR

PRU

PHL

POR

SAF

SKR

SPN

SWE

SWZ

TAI

USAURU

VNZ

010

2030

Tra

nsfe

r Spe

ndin

g P

er C

apita


Source: Rafael LaPorta, Harvard University, r2 =.357

Former and Current Communist Nations ExcludedTransfer Spending from Rich to Poor and Trust in People

Countries with higher levels of trust spend more per capita on transfers

from the rich to the poor.

36

Figure 9

ARG

ARM

AUS

AST

AZR

BNG

BLR

BEL

BRZ

UK

BUL

CAN

CHL

COL

CRO

CZK

DEN

DOM

EGR

EST

FIN

FRA

GEO

GHA

HUN

ICE

IND

IRE

ITA JPN

LAT

LITLUX

MEX

MOL

HOL

NIG

NOR

PRU

PHL

POL

POR

ROMRUS

SAF

SKR

SLV

SLO

SPN

SWE

SWZ

TAI

USA

UKR

URU

VNZ

05

10P

olity

III D

emoc

racy

Sco

re


Source: Polity III Database, Ted Gurr, University of Maryland, r2 =.177

Democracy and Trust in People

There is only a weak relationship between a country’s level of democracy and its level of trust.

37

Figure 10

RUS

BRZ

LITEST

ARG

SAF

LAT

CZK

BLR

HUN

BUL

ROMPOL

POR

ITASPN

IND

JPN

SLO

HOL

BEL

FIN

AST

WGRNIR

SWE

FRA

UK

SWZ

USA

NOR

DEN

CAN

TUR

SKR

IRE

MEX

NIG

ICE

EGR

CHL

0.2

.4.6

Mos

t Peo

ple

Can

Be

Tru

sted

0 10 20 30 40Postmaterialism World Values Survey

r2 = .164

Trust in People and Postmaterial Values

There is only a weak relationship between the levels of trust and postmateralist values across countries.

38

Figure 11

ARG

AUS

AST

BRZ

UK CAN

CHL

COL

DEN

FIN

FRA

IND

IRE

ITA

JPNMEX

HOL

NIG

NOR

PHL

POR

SAFSKR

SPN

SWE

SWZ

TUR

USA

VNZ

WGR

02

46

For

eign

Pol

icy

Glo

baliz

atio

n In

dex

0 .5 1 1.5 2Total Memberships in Voluntary Associations, World Values Surveys

Source: Foreign Policy index of globalization r2 =.038

Former and Current Communist Nations ExcludedGlobalization and Voluntary Association Membership

There is no clear relationship between the level of membership in voluntary associations in a country and its level of globalization.

39

Figure 12

ARG

AUS

ASTBEL

BRZ

UKCAN

CHL

COLDEN

FIN

FRA

ICE

IND

IRE

ITA

JPN

MEX

HOL

NIG

NOR

PHL

POR

SAF

SKR

SPN SWESWZ

TURUSA

URUVNZ

WGR

010

020

030

0R

eal G

row

th R

ate

1980

s

0 .5 1 1.5 2Total Memberships in Voluntary Associations, World Values Surveys

Source: Penn World Tables, r2 =.027

Former and Current Communist Nations ExcludedReal Growth Rate 1980s & Voluntary Association Membership

There is no clear relationship between the level of membership in voluntary associations in a country and its rate of economic growth.

40

NOTES * This article summarizes arguments in Uslaner (2002). I gratefully acknowledge the

support of the General Research Board of the University of Maryland--College Park and

the Everett McKinley Dirksen Center for the Study of Congressional Leadership. Most

of the data discussed here were obtained from the Inter-University Consortium for

Political and Social Research, which is absolved from any responsibility for my claims.

See Uslaner (2002) for a list of my other obligations, but here I single out Dietlind Stolle

and Bo Rothstein.

1. The term “strategic trust” is mine. Most of the people I cite would like find the

terminology congenial. Hardin (1992, 163) emphatically holds that “there is little sense in the

claim of some that trust is a more or less consciously chosen policy...” Trust based on

experience can be strategic even if we do not make a deliberate choice to trust on specific

occasions.

2. This result comes from an analysis of the 1993 General Social Survey in the United

States, where performing music is best predicted by liking classical music–as well as looking for

opportunities to meet others with similar preferences–other predictors are age (young) and

income (high).

3. I use either two- or three-stage least squares estimation to investigate reciprocal linkages.

4. In the 2000 American National Election Study, 40.7 percent of all Americans called

themselves “born-again Christians,” rising to 57.9 percent in the South.

41

5. In Uslaner (2002, ch. 5), I show that there is no statistical linkage between trust in people

you know and trust in strangers.

6. In this and several of the other graphs, including Figure 1, I exclude former and current

Communist nations. First, some of the economic data for these countries may not be reliable.

Second, the economic data in these tables do not reflect market forces as they do in capitalist

countries, so the comparisons may not be appropriate.

7. The correlations are in the range of .4 to .5, except for the openness of the economy

(where the correlation approaches .7).

Documents

Trust in the Knowledge Society* Eric M. Uslaner Department of Government and Politics University