Informal Networks Are Not Conducive to Trust

What are the reasons for low levels of trust in the Middle Eastern countries? How do civil society and civic engagement contribute to building trust? These were the issues addressed by Duke University Professor Timur Kuran during his lecture on Historical Roots of Trust, Cooperation, and Development. The lecture was held at the sixth LSCR international seminar in the framework of XVII April International Academic Conference.

Professor Kuran argued that institutional and interpersonal trust are crucial for economic performance because low trust entails high transaction costs. World Values Survey data show that generalized trust tends to be lower in Muslim countries. Trust games demonstrate similar results. He argued that results obtained from experiments are more reliable than those obtained using the classic survey question 'Generally speaking, would you say that most people can be trusted or that you should be careful when dealing with people?’

According to historical anthropologists, the cross-national differences in the level of trust are related to unequal access to state services. In Western societies, in order to acquire a certain good or service one needs to identify and follow the relevant legal procedures. By contrast, in some Eastern societies, actors make use of informal networks and insider brokers to acquire goods and services.

Prof. Kuran proposed three historical mechanisms to explain the trust differences between the Western and Middle Eastern nation-states. First, he argued that the very organization of the private economy shapes trust. In the Middle East, resources were pooled through small and ephemeral partnerships until the 19th century. By contrast, the high trust levels in Western nation-states are the result of a long-standing corporate culture development. In the Middle East, complex organizational forms did not exist until the mid-19th century. The second reason is the Muslim law enforcement. Muslim judges often made decisions in favor of the elites, males and Muslims. This inequality in law enforcement made the latter groups less trustworthy. Although traditional Islamic courts no longer exist, their effect on trust endures. Last but not least, Prof. Kuran maintained that a weak civil society is conducive to low trust. Until the 20th century, social services in the Middle East were provided through Islamic trusts that limited political participation, accountability and coalition formation. Although these institutions are well-suited for medieval societies, they are detrimental to trust.

Prof. Kuran concluded with policy recommendations about how to increase the level of trust in Muslim nation-states. He argued that the reasons of low trust are deeply embedded in the local culture and there is no quick solution. He based his first proposition on Robert Putnam’s classic work on the role of civil society. He claimed that civic engagement is conducive to higher trust. Prof. Kuran further argued that a second pathway to trust can be increasing economic and social cooperation. When actors of different groups cooperate they complement their skills, and thus enhance interpersonal trust.

Prepared by Olesya Volchenko and Ivan Aimaliev, Laboratory for Comparative Social Research