Generalized Trust and Why It Matters for Business

Generalized+Trust+and+Why+It+Matters+for+Business+in+the+Age+of+Globalization%0d%0a%0d%0aEric+M.+Uslaner+Professor+of+Government+and+Politics+University+of+Maryland+College+Park%2c+MD+20742+USA+http%3a%2f%2fwww.bsos.umd.edu%2fgvpt%2fuslaner%0d%0a%0d%0a%0cTrust+has+many+different+meanings%3a%0d%0a%ef%81%ac%0d%0a%0d%0aStrategic+trust%3a+trust+we+gain+from+daily+experience.+Particularized+trust%3a+trust+in+people+like+ourselves.+May+stem+from+direct+experience+or+from+stereotypes.+Generalized+(moralistic)+trust%3a+Trust+in+strangers%2c+especially+people+who+are+different+from+ourselves.+Cannot+come+from+interaction+with+people+we+know.%0d%0a%0d%0a%ef%81%ac%0d%0a%0d%0a%ef%81%ac%0d%0a%0d%0a%0cGlobalization+offers+great+opportunities+and+great+risks+for+business+and+society.+%ef%81%ac+Biggest+challenge+to+globalization+is+how+business+can+adapt+in+different+cultural+environments.%0d%0a%ef%81%ac%0d%0a%0d%0a%0c%ef%81%ac%0d%0a%0d%0aGeneralized+trust+is+the+sense+of+a+shared+fate+with+others.+It+is+more+than+trust+based+upon+experience.%0d%0a%0d%0a%ef%81%ac%0d%0a%0d%0aGeneralized+trust+rests+upon+optimism+and+a+sense+of+control+of+your+environment.%0d%0a%0d%0a%0c%ef%81%ac%0d%0a%0d%0aTrust+promotes+diversity+and+tolerance.+Trust+makes+it+easier+for+companies+to+work+in+a+globalized+economy.%0d%0a%0d%0a%ef%81%ac%0d%0a%0d%0a%0c%ef%81%ac%0d%0a%0d%0aTrust+is+based+upon+a+presumption+of+good+will.+It+is+business+on+a+handshake.+Relying+on+courts+to+solve+problems+shows+a+lack+of+trust.%0d%0a%0d%0a%ef%81%ac%0d%0a%0d%0a%0cTrusting+people%3a+%ef%81%ac+See+a+common+vision+for+society+%ef%81%ac+Are+more+willing+to+take+risks+in+business+and+in+life.+They+underestimate+the+amount+of+risk+in+life+and+mistrusters+overestimate+the+amount+of+risk.+%ef%81%ac+Are+more+open+to+new+technologies+and+to+taking+new+initiatives.%0d%0a%ef%81%ac%0d%0a%0d%0a%0cTrusters+do+good+deeds%3a+%ef%81%ac+Give+to+charity%0d%0a%ef%81%ac%0d%0a%0d%0a%ef%81%ac%0d%0a%0d%0aVolunteer+time%0d%0a%0d%0a%0cTrusting+societies+have%3a%0d%0a%0d%0a%ef%81%ac+%ef%81%ac+%ef%81%ac+%ef%81%ac+%ef%81%ac%0d%0a%0d%0aMore+open+markets+Greater+economic+growth+Lower+crime+rates+Stronger+legal+institutions+More+spending+on+education%0d%0a%0d%0a%0cAs+trust+has+declined+in+the+United+States%0d%0a%0d%0a%ef%81%ac%0d%0a%0d%0aFewer+people+volunteer+People+give+less+of+their+income+to+charity+Political+and+social+life+becomes+more+polarized.%0d%0a%0d%0a%ef%81%ac%0d%0a%0d%0a%ef%81%ac%0d%0a%0d%0a%0cTrust+and+Economic+Inequality%0d%0aWhy+do+some+countries+have+more+trusting+people+than+others%3f+Their+distribution+of+income+is+more+equal!%0d%0a%0d%0aTrust+in+People+and+Economic+Inequality%0d%0aFormer+and+Current+Communist+Nations+Excluded%0d%0aNOR+SWE+DEN%0d%0a%0d%0aMost+People+Can+Be+Trusted%0d%0a%0d%0a.6%0d%0a%0d%0aGRE+IRE+NZ+UK+WGR+TAI+JPN+AUS+IND+SWZ+USA+ITA+BEL+LUX+AST+SPN+SKR+ISR+FRA+POR+GHA+NIG+CY+P%0d%0a%0d%0aFIN%0d%0a%0d%0aHOL+CAN%0d%0a%0d%0a.4%0d%0a%0d%0aMEX+DOM+URU+ARG+VNZ+TUR+COL+PHL+BRZ+CHL+SAF%0d%0a%0d%0a.2%0d%0a%0d%0a0%0d%0a%0d%0aPRU%0d%0a%0d%0a.2%0d%0ar2+%3d+.391%0d%0a%0d%0a.3%0d%0a%0d%0a.4+.5+Gini+index+economic+inequality%0d%0a%0d%0a.6%0d%0a%0d%0a%0cTrust+and+Inequality+in+the+United+States%0d%0a%0d%0a%ef%81%ac%0d%0a%0d%0aAs+inequality+has+risen%2c+trust+has+declined%3a%0d%0aTrend+in+Economic+Inequality+1960-2002%0d%0a%0d%0a.45%0d%0a%0d%0a01+98+00+93+94+95+96+02+99%0d%0a%0d%0aGini+Index+of+Ecnomic+Inequality%0d%0a%0d%0a88+86+85+87+84+8283+60+64+66+68+81+79+72+7577+80+73+74+78+71+76%0d%0a%0d%0a89+92+91+90%0d%0a%0d%0a.3%0d%0a1960+r2+%3d+.873%0d%0a%0d%0a.35%0d%0a%0d%0a.4%0d%0a%0d%0a1970%0d%0a%0d%0a1980%0d%0aYear%0d%0a%0d%0a1990%0d%0a%0d%0a2000%0d%0a%0d%0a%0cCommon+foundations+of+trust+and+globalization%0d%0aReaching+across+cultural+boundaries+Cooperation+across+diverse+groups+Promotion+of+open+markets+Trust+promotes+innovation%2c+globalization+depends+upon+it.+Globalization+needs+strong+legal+institutions%2c+trust+provides+foundation+for+them.%0d%0a%0d%0a%ef%81%ac%0d%0a%0d%0a%ef%81%ac%0d%0a%ef%81%ac+%ef%81%ac+%ef%81%ac%0d%0a%0d%0a%0cTrust+and+Globalization+Go+Together%0d%0aGlobalization+and+Trust+in+People%0d%0aFormer+and+Current+Communist+Nations+Excluded%0d%0aHOL+SWZ%0d%0a%0d%0a6%0d%0a%0d%0aSWE%0d%0a%0d%0aIRE+UK%0d%0a%0d%0aFIN%0d%0a%0d%0a4%0d%0a%0d%0aAST+USA+POR+SPN+FRA+ITA+WGR+AUS+SAF+PHL+BRZ+TUR+PRU+COL+CHL+SKR+MEX+NIG+IND+JPN%0d%0a%0d%0aCAN%0d%0a%0d%0aNOR+DEN%0d%0a%0d%0a2%0d%0a%0d%0aGRE%0d%0a%0d%0aVNZ+ARG%0d%0a%0d%0a0%0d%0a0+.2+.4+.6+Most+People+Can+Be+Trusted%2c+World+Values+Surveys+and+Intl+Social+Survey+Program%0d%0aSource%3a+Foreign+Policy+index+of+globalization+r2+%3d.531%0d%0a%0d%0a%0cBusinesses+Building+Trust%0d%0aExamples%3a+%ef%81%ac+Swiss+Re%0d%0a%ef%81%ac+%ef%81%ac%0d%0a%0d%0aBen+and+Jerry%e2%80%99s%0d%0a%0d%0a%ef%81%ac%0d%0a%0d%0aBirkenstock%0d%0a%0d%0a%0cWhat+Businesses+Can+Do%0d%0a%ef%81%ac%0d%0a%0d%0aSince+trust+stems+from+your+parents+early+in+life%2c+businesses+that+give+more+free+time+for+family+life+help+create+trust.%0d%0a%0d%0a%0c%ef%81%ac%0d%0a%0d%0aEducation+also+leads+to+greater+trust.+Companies+that+provide+greater+educational+opportunities+for+employees+build+trust.%0d%0a%0d%0a%0cPromoting+community+service+builds+trust%0d%0a%ef%81%ac%0d%0a%0d%0aProvide+opportunities+for+charitable+contributions+and+voluntary+%e2%80%9cvolunteering.%e2%80%9d+Involuntary+%e2%80%9cvolunteering%e2%80%9d+may+lead+to+workers%e2%80%99+resentment+by+the+workforce.+Showing+the+way+by+being+a+good+corporate+citizen%e2%80%94giving+to+charity+and+providing+time+off+for+volunteering.+Every+little+bit+a+business+can+do+to+reduce+inequality+helps.%0d%0a%0d%0a%ef%81%ac%0d%0a%0d%0a%0c