SUMMARY We present new evidence on how generalized trust is formed. Unlike previous studies, we look at the explanatory power of economic institutions, use newer data, incorporate more countries, and instrumental variables in an attempt to handle causality problem. A central result that legal structure security property rights (area 2 Economic Freedom Index) increase trust. The idea a market economy, building voluntary transactions interactions with both friends strangers within...

Summary Tolerance has the potential to affect both economic growth and wellbeing. It is therefore important discern its determinants. We contribute literature by investigating whether degree which institutions policies are market‐oriented related different measures of tolerance. Cross‐sectional first‐difference regression analysis up 69 countries reveals that freedom positively tolerance towards homosexuals, especially in longer run, while people a race willingness teach kids not strongly...

Since good-looking politicians win more votes, a beauty advantage for on the left or right is bound to have political consequences. We show that look beautiful in Europe, United States and Australia. Our explanation people earn more, which makes them less inclined support redistribution. model of within-party competition predicts voters use as cue conservatism when they do not know much about candidates benefit from low-information elections. Evidence real experimental elections confirms...

Abstract: We study the effects of institutional instability on growth. Using principal components analysis, we construct measures quality and from political risk index International Country Risk Guide. A panel-data analysis 132 countries during 1984–2004 reveals that quality, especially with regard to legal system protection property rights, is positively linked As for instability, find evidence a positive relationship in rich but negative link poor countries, suggesting may reduce problems...

Tolerance is a distinguishing feature of Western culture. Still, it varies between and within countries, as well over time, irrespective whether one values for its own sake or beneficial consequences, becomes important to identify determinants. In this study, we investigate the character economic policy plays role, by looking at effect changes in freedom (i.e., lower government expenditures, more general taxes modest regulation) on tolerance most market-oriented United States. comparing U.S....

Many countries have undertaken central-bank independence reforms, but the years of implementation differ. What explains such differences in timing? This is interest more broadly, as it sheds light on factors that matter for speed at which economic reforms come about. We study a rich set potential determinants, both and political, put special focus cultural factor, social trust. find empirical support an inverse u-shape: Countries with low high trust implemented their earlier than...

Social trust has been identified as a catalyst for reforms. We take the literature further in two ways. First, we analyze mechanisms through which social enables liberalizing reforms—by overcoming obstacles political process (stemming from ideology, ideological fractionalization, coalition government, minority and legislature-seat instability). Second, define reforms distinct changes quality of legal institutions scope regulation separate that increase economic freedom these areas decrease...

Abstract Social and cultural determinants of economic institutions outcomes have come to the forefront research. We introduce religiosity, measured as share for which religion is important in daily life, explain institutional quality form property rights rule law. Previous studies only impact membership shares different religions, with mixed results. find, a cross-country regression analysis comprising up 112 countries, that religiosity negatively related our outcome variables. This holds...

Abstract The issue of what explains differences in the wealth nations is one most classic economics. We propose de facto academic freedom as an explanatory variable. main idea that such allows for development new useful knowledge through research unconstrained by powerholders business and politics. Using a global panel‐data set, encompassing up to 127 countries over period 1960–2015, we show there indeed positive relationship between both labor total‐factor productivity growth. However, this...