DP17115 Impersonal Trust in a Just and Unjust World: Evidence from an Educational Intervention

Author(s): Sule Alan, Elif Kubilay
Publication Date: March 2022
Keyword(s): Education, impersonal trust, Inequality, prosperity
JEL(s): C93, D63, I24
Programme Areas: Development Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=17115

We provide causal evidence on how impersonal trust and reciprocity create prosperity and shape its distribution. For this, we leverage a large-scale randomized educational intervention that boosts trust and reciprocity in children. We show that in a world where individuals trust anonymous others, prosperity grows but so does inequality. While impersonal trust unambiguously creates wealth, redistribution is needed to tame the inequality it brings. Our results suggest that harnessing prosocial psychology through educational actions may pave the way for a prosperous and just society. However, for these actions to ultimately achieve this end, they should be pervasive and universally accessible.