What is a High-Trust Society?

A high trust society is one where vegetables can be sold unattended on the roadside, placed in boxes together with a price list, a pair of scales, and a cigar box for the money. Ditto for newspapers.

I have observed that the topic of trust and its importance to a successful economy doesn't seem to resonate with the audience as much as it should. You are to be commended on discussing the topic.

I particularly enjoyed the related discussion of Douglas North. The importance of how attitudes of consumers and producers toward themselves and government can not be over emphasized. All we need to do is observe how other countries are unable to breakout into sustained high rates of growth due to the inability to deal with corruption and antipathy to private property rights and market based economy (this pretty much applies to all "developing nations" such as Africa and Latin America not to mention Arab states).

Those countries which have succeeded do so by compromising on civil liberties (China and Russia). It takes generations to establish trusted institutions and the legal infrastructure to enforce property rights. Unfortunately, this trust can be destroyed much faster than it takes to establish that trust. Such is my biggest fear for our country. Citizens don't really understand economics and we, as a nation, are getting increasingly confused by politicians about what it takes to establish and maintain the trust necessary for a free market economy to thrive.

This is the meaning of "commitment" in the time consistency literature. In fact, the time consistency concept might be a good topic to discuss as a natural extension of the discussion of trust.

And so, is the balance of power idea still working at all? Congress hates the Judiciary; the Judiciary hates Congress; and everyone seems to hate the Executive. So, maybe it's working. ;)