Tuesday, June 24, 2008

The History of Trust

One of last year's notable books was Yann Algan and Pierre Cahuc's La Société de défiance, a work that purported to show that French society was beset by a crisis of confidence stemming from a corporatist reaction to a dirigiste state. The seeds of this lack of trust were sown, allegedly, in the postwar compromise among social partners that created the welfare state.

Now, in a very interesting critique, Nicolas Delalande questions this thesis from two angles. First, he notes that the statistical evidence on which the case that France is an especially distrustful society rests looks less impressive when the Scandinavian countries are left out. Second, he questions the underlying historical premise of the work by the two economists. In Delalande's view, Algan and Cahuc see the Third Republic as a "golden age" of trust, which they claim came to an end in World War II and its aftermath. But what if this is not the case? It would certainly come as a surprise to many students of the history of France that "the contentious French" enjoyed a happy hiatus of mutual confidence in the years before the Second World War.

Although Delalande doesn't say so, his critique raises questions about a type of argumentation that has become popular in recent years. Algan and Cahuc rely heavily on survey data such as the General Social Survey and World Values Survey. Similarly, Thomas Philippon, in another much-praised book, also relied on data gathered by questionnaire. Econometric methods were then used to relate these soft data to "harder" statistics pertaining to economic performance. The sophisticated machinery yielded an air of solidity to conclusions that call for closer scrutiny. To put it bluntly: How trustworthy are the comparative data about trust? Do the questionnaires perhaps magnify cross-cultural differences? In view of the interest that Algan and Cahuc's work has attracted, their methods deserve careful study. Nicolas Delalande's essay has the merit of making a start in that direction.