Christianity, Trust and Economic Growth
Trust: The Social Virtues and the Creation of Prosperity, by Francis FukuyamaMy reason for posting this book summary is to highlight the connection between what the church does and ideas that promote progress. Christian communities today, have the opportunity to counterbalance trends in America that may be dangerous. In order to do this we need to continue to build strong communities that are missionary in their nature and develop trust among people. If we grow in this area, we continue to create a society of progress that brings solutions to global problems.
Social capital, the ability to create spontaneous social networks of trust, is critical to how an economy grows. High-trust cultures are better than low-trust cultures when it comes to the growth of large companies that significantly impact economic development within that culture. This is essentially the argument Fukuyama makes in Trust.
Trust (defined as “the expectation that arises within a community of regular, honest, and cooperative behavior, based on commonly shared norms, on the part of other members of that community” (p. 26)) lubricates an economy by reducing the transaction costs and consequent drain on resources. It is a significant part of the overall culture (defined as “inherited ethical habit” (p. 34)) found in a society. Christianity offers the best mechanism to build trust.
Fukuyama analyses especially the countries of Japan and Germany (which he tags as the leaders of high-trust countries) and lower trust countries of China, Korea, Italy and France. The United States is also studied as having a combination of fierce individualism alongside the propensity for communal association.
America is an interesting study in contrasts. While Americans boast of their fierce independence, they have also shown a great proclivity to form associations (see also Tocqueville, Democracy in America). Those associations signify that America may be a higher trust society than we believe. However, in more recent decades the breakdown of the family, rising crime rates, and the litigious nature of business illustrate some disturbing trends.
The role of faith in promoting a culture of trust is very evident in Trust. Those who would eliminate the role of the church in American society receive a rebuke from Fukuyama, as he defends the importance of religious institutions to help build trust in society moving forward, and the role those institutions played in laying the foundation for an economy built on trust.
If you would like to read more, please email me and I'll send you the rest of the summary: rich.swanson@uscm.org.