Southern Europe is suspicious: the evolution of trust in the EU
Analysis of the eurozone crisis and its consequences has started to consider its social, as well as political and economic, dimensions. Bruegel analysis, for example, has considered distributional challenges, effects on poverty levels, social security systems, and changes in confidence towards political institutions. Academic economic research into the significance of cultural values, such as trust, suggests a viable new route to consider some of these deep-rooted social consequences of Europe’s economic woes, and we seek here to sketch some stylised empirics. If we think that such social values are both economically important and that it is very hard to change them, then the findings are worrying. Economic crisis has been associated with a striking degradation in the levels of interpersonal trust in southern Europe. In an often cited quote from 1972, Kenneth Arrow wrote that “Virtually every commercial transaction has within itself an element of trust … It can be plausibly argued that much of the economic backwardness in the world can be explained by the lack of mutual confidence”.
- analysis from Bruegel.org