FEELINGS ABOUT COMPETITION AND SELF-REPORTED TRUST EVIDENCE FROM THE WORLD VALUE SURVEYS

Abstract

This paper estimates the relation between individual feelings about competition and self-reported horizontal trust. Individuals who increasingly dislike competition report lower levels of trust towards others. But the association is not linear. This finding is different than and complements previous research which shows a positive or negative relation. We conclude that the evolution of perceptions of competition may be causing more harm than good in terms of trust and wellbeing, and policy should direct efforts at minimizing the negative effects of one of the most important institutions of market capitalism: competition. The paper improves over previous research by using individual-level measures while at the same time considering objectives measures of competition. We test for robustness of our results by considering different approximations for trust. We conjecture about the potential negative effects on Trust and Social Capital of the declining appreciation of the benefits of competition.