In truth it is a
narrative struggling to describe the aggregate behavior of humans. It
seeks to cloak its uncertainties and shifting fashions with
mathematical formulae and elaborate econometric computerized models.
So much is certain, though - that people operate within markets, free
or regulated, patchy or organized. They attach numerical (and
emotional) values to their inputs (work, capital) and to their
possessions (assets, natural endowments). They communicate these values
to each other by sending out signals known as prices.
Yet, this entire edifice - the market and its price mechanism -
critically depends on trust. If people do not trust each other, or the
economic "envelope" within which they interact - economic activity
gradually grinds to a halt. There is a strong correlation between the
general level of trust and the extent and intensity of economic
activity.
Trust is not a monolithic quantity. There are a few categories of
economic trust.
Some forms of trust are akin to a public good and are closely related
to governmental action or inaction, the reputation of the state and its
institutions, and its pronounced agenda. Other types of trust are the
outcomes of kinship, ethnic origin, personal standing and goodwill,
corporate brands and other data generated by individuals, households,
and firms.
Pages:
146
147
148
149
150
151
152
153
154
155
156
157
158
159
160
161
162
163
164
165
166
167
168
169
170