Public Choice

, Volume 157, Issue 1–2, pp 269–286 | Cite as

Does social trust determine the size of the welfare state? Evidence using historical identification

Article

Abstract

Most modern welfare states offer an extensive array of services and benefits that are wholly or partly financed by tax revenue. One missing link in explaining the long-run sustainability of such comprehensive welfare states could be the already-existing stock of trust. Indeed, our cross-country results suggest that trust determines the size of welfare states as well as three features that are arguably necessary for their preservation: high levels of political confidence, strong legal institutions protecting private property rights, and low levels of bureaucratic corruption.

Keywords

Social trust Welfare state US immigrants Historical identification 

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Copyright information

© Springer Science+Business Media, LLC 2012

Authors and Affiliations

  • Christian Bjørnskov
    • 1
  • Gert Tinggaard Svendsen
    • 2
  1. 1.Department of Economics and BusinessAarhus UniversityÅbyhøjDenmark
  2. 2.Department of Political ScienceAarhus UniversityAarhus CDenmark

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