Abstract
Markets can only function properly in the presence of sufficient trust. We explore the relation between trusting behavior and market integration in rural China. We link the results of a trust experiment to actual behavior in the field (participation in the labor market versus informally exchanging labor), and find that high-trust households are more likely to use formal markets. We proceed by exploring the relation between labor market participation and economic outcomes, finding tentative evidence of a causal relation running from market participation to higher levels of income.
| Original language | English |
|---|---|
| Pages (from-to) | 1179-1190 |
| Journal | World Development |
| Volume | 38 |
| Issue number | 8 |
| Publication status | Published - 2010 |