Social trust and food scandal exposure: Evidence from China

Abstract

Food safety problems are drawing increasing attention after the occurrence of repeated food scandals in China. The literature has found that social trust, a non-institutional factor, is an important factor in disciplining dishonest behaviour and improves the media's incentives to report. In this paper, we develop a model to investigate the dual effects of social trust—behaviour discipline effect and media enhancing effect—and analyse its interplay with institutional factors on food scandal exposure. The theory is then tested using 2004–2011 food event data. The results show that trust has a significant positive impact on food scandal exposure, which implies that the media enhancing effect plays a dominant role in China. However, this effect is weakened in provinces with a higher level of law enforcement and market development, which suggests that institutional factors are a substitute for social trust in affecting food scandal exposure in China.