Good morning everyone. Some people are still trickling in but let's start. Welcome to the keynote lecture of the wider development conference, the puzzle of peace towards inclusive development and fragile context. I'm pleased to introduce Sir Timothy Beasley who will provide the keynote lecture of the conference. Tim Beasley is school professor of economics and political science. The W Arthur Lewis professor of economics and of development economics at the London School of Economics and Political Science. From September 2006 to August 2009, he served as an external member of the Bank of England's Monetary Policy Committee. Since 2015, he's been a member of the UK's National Infrastructure Commission. He's a fellow of the Economic Society, the British Academy and the European Economic Association. He's also a foreign honorary member of the American Economic Association and the American Academy of Arts and Sciences. He's currently president of the Royal Economic Society and has served as president of the International Economic Association, the European Economic Association, the Economic Society, the most prestigious societies and economics. Professor Beasley is also a past co-editor of the American Economic Review and a 2005 winner of the Jero Johansson Prize of the European Economic Association. He's been recently appointed to the UK government's Leveling Up Advisory Council. Relevant to this conference, Tim was one of the two academic directors, along with Paul Goliath, of the Commission on State Fragrility, Growth and Development. Tim was awarded a knighthood in the 2018 New Year's Honours by the UK government for his services to economics and public policy. Tim has been the leading exponent of the new political economy, which has led to fruitful, interdisciplinary conversations between economists and political scientists. Such productive exchanges between economists and political scientists is very evident in our conference. In his book, Pillars of Prosperity, the Political Economies of Development Clusters, co-authored with Thurston Person, published by Princeton University Press, Tim argued that absence of common interests and cohesive political institutions can explain the very different development clusters in fragile states that are plagued by poverty, violence, and weak capacity. This book has had a huge influence in our thinking on how state-building is possible in conflict-affected societies. It has shaped the work of several of our projects in UNI wider. In today's lecture titled Trust as State Capacity, Tim will discuss the link between trust in government and building states that are effective in taxing, regulating, and providing public services. Tim, I'm pleased to invite you to provide the keynote lecture of the conference. Thank you, Kenneth, for that lovely introduction. It's one of those occasions that have my parents been here. My father would have been proud and my mother would have believed you. And it's lovely to be back in person. It's lovely to be back in Helsinki, where, in fact, the Yuri Jonsson Lectures were where we first developed the Pillars of Prosperity book. It's also lovely to be wearing a tie again. I have a fantastic collection of ties, which I haven't been able to wear for two years, so forgive me for looking a little overly formal, but I thought that it's too good an opportunity to pass up. I'm going to talk about this theme, Trust as State Capacity, which is a slightly mea culpa moment, because I don't think we took the ideas I'm going to talk about today sufficiently seriously in our earlier work on state capacity. And I think it fits. I hope you'll see it fits with some of the themes in the conference that you've been participating in over the last third day or so. Why are we here? I think we're here because we think it's important to build peace and to develop effective states that can support that peace. And that's a very central topic, both in practical and academic terms, to understand that. And when we give an answer to why we think we can what we can say about that and step back and say, what does the evidence tell us? I think it tells us that at the heart of that is developing some notion of cohesion within society that can also be represented in the way that the state governs. And there's sort of two broad themes in the literature. One that I think is more the view that economists have subscribed to, which is central to build the right kinds of institutional framework to support that cohesion. And the other, which I think is definitely alive and well, but perhaps less central to the economic approach, is the need to build a strong civic culture to support state building. And there's now an established literature on state capacity, which has been developed in a variety of ways by a number of people. And what's important, and I'm going to draw this link out, is that building state capacity is linked to peace. Whether it's causally linked, that's another matter, but it's certainly linked in the sense that where we observe strong state capacity, that's strongly associated with peaceful environments. And it's linked also to strong institutional environments. And I'm going to be specific about what I mean by strong institutional environment in a moment. And I think the way economists have brought up to believe, at least perhaps I'm just too old and represent a past incarnation of this, but is that the way we build strong and effective states is by the accumulation of power within state structures. So the archetypal notion of a strong and effective state for an economist is a state run by a benevolent social planner who has sufficient authority to get done all of those wonderful things that benevolent planners want to do. And I think in many ways that's an unhelpful way to begin thinking about the challenge of effective policy. And for reasons I'm going to articulate. But I think that's a kind of starting point that we ought to be moving away from, but it's so firmly ingrained in the economic model of policymaking. If you'd asked me when I was a graduate student what I was going to spend my career doing, I was so enamoured with that idea that that's what economic policy economists do, that I thought my entire career would be devoted to looking at better ways for governments to intervene in economies and then lecturing policy makers until they took the idea seriously and that would materialise in a wonderful and improved policy setup. But a defining moment for me, although there was a sort of lag on the impact of this on my career, was when I went as an assistant professor at a Princeton for my first job and I ran into a senior economist who's now actually a dear friend and he asked me what I worked on and I reeled off a list of things and rather proudly said I listed among my interests economic development and then his face suddenly turned to a very disapproving tone and he said I used to be interested in economic development but I realised all the problems of development were political and so I gave up being interested in economic development. Well rather than giving up I think what we've done as economists and this room reflects that is to take seriously the political dimensions and think how to integrate those into our understanding of development. Now just to sort of stand back and there's sort of two big picture views of where effective states come from and as I say I think the first view is much more the one that's been traditionally embraced by economists which I call the Leviathan view which one associates of course with Hobbes but also with Max Weber that the state the essential nature of the state is as a coercive authority. Indeed the state has a legitimate use of force it's the only agent that we think should have a legitimate use of force and the way it exercises that is by investing in coercive compliance which underpins state effectiveness and that improves detection and punishment for those who don't go along with what the state wants them to do and I think that has by and large been the approach taken by economists. There's another tradition quite distinct tradition which I associate with Locke and Rousseau but there's a long potential list here is to think more of the state as a form of social contract where citizens and states have mutual obligations that citizens are obliged to engage in certain kinds of pro-social behavior which I'll talk a little bit later in the talk about what I mean by that exactly and that states reciprocate by by doing the kinds of things that will increase the welfare of their citizens and on that view building trust in the state is the key element of state effectiveness building that strong reciprocal bond between state and citizens and that's the way to move forward. Now of course no one ever believes in these either extreme versions but I want to sort of somewhat argue that we've neglected we meaning those of us who've been working on state capacity perhaps neglected the second at the expense of the first. What is state capacity well how do I understand that idea it's those things that enhance the ability of the state to get things done increasing the feasible set of policies available to government and also allowing you to implement policies more cheaply or more effectively. There are general dimensions of state capacity such as collecting taxes fiscal capacity enforcing laws legal capacity and having the ability to to augment markets in the form of what I call collective capacity which means the provision of healthcare education infrastructure or whatever. They're also very specific so that's a kind of generalized notion but there are also very bespoke forms of state capacity public health capacity defense fighting climate change. The reason I mention that is there's a debate going on which some of you would be familiar with particularly in relation to climate change of whether there are bespoke institutions that are needed even in weekly institutionalized environment. So I sit on a on an advisory group of the World Bank and IMF on sustainable and inclusive recovery and one of the debates is we well we know that we need to spend however many trillions of dollars on low carbon alternatives. The real question is delivery. How do we actually conceptualize the capacity to deliver on that agenda? And the question is do we just have to wait till states develop generalized state capacities or should we be thinking of building specialized state capacities for example in the energy sphere that allows states to make an energy transition even if we accept that the generalized state capacity is not developed. But anyway that's a debate that's that's raging within within the international policy community about what is the state capacity needed to support climate change. What we know from the data and there's not hardly surprising is that that state capacity clusters across space and and accumulates over time but is very very slow to accumulate. There are very few countries that have made a meaningful transition and you know when I go back and we're in Scandinavia I read Gunnar Merdahl's account of economic development which of course led to a Nobel Prize. He very much saw very stark non-linear transformation as the key thing that we mean by development is distinct from growth. Growth patterns of course can be sometimes very non-linear but on the whole they're cumulative whereas what Merdahl talks about are those transformational moments where you can move from one kind of society polity and economy to a different kind of society and that's very very rare as we all know. So you know if you plot these are crude measures of state capacity and even harder to read because somehow my slide is a little fuzzy but basically if you plot measures of fiscal capacity legal capacity and collective capacity the really interesting thing I think when you look at this is you always get these red dots up here. These are the strong and successful states also peaceful states we're in one today and then you get sort of a mix this is the middle income countries which are sort of generally somewhat distributed and then this is the lower income countries which generally have lower state capacities now of course there's nothing causal about this. One interesting thing to do is to is to take a standard state fragility index and to separate this out instead of high lower middle and it won't surprise you that the non-fragile states are all up here and the fragile states are down here nothing surprising in any of this but we know that there are these strong associations in the data. Why does state capacity matter? It matters directly because without it you cannot provide the core support for human capability that many of the things the collective needs that societies need cannot be delivered upon without having a state that can raise revenues and without having a state that can then spend those revenues in an effective manner and also promote prosperity by having an effective open market economy and all of that is only feasible because a state has acquired the capacities to support that but it's also sort of an indirect so that's the kind of direct benefit from state capacity but the indirect benefit is a kind of bellwether of flourishing societies and I'll just show you one thing in a couple of slides time to illustrate what I mean by that. There are two ends of the spectrum we saw a little bit at one end of the spectrum are what I call the cohesive capitalist countries that have emerged mainly in the post-war era and have very strong state capacities and in a sense what I think many other countries in the world aspire to not all but most aspire to become and then there are at the other end of the spectrum the fragile states that function poorly on almost all dimensions of state capacity. Where does state capacity come from? Well there's two sort of broad views they mirror the sort of two views of the state that I gave you upfront one is that state capacity is the kind of top down investment and I like to think of it I don't know how much you followed the literature on intangible capital but if you look at modern firms and say kind of how do they improve their productivity the old fashion view I mean being a little stuck in the way I'm expressing this the old fashion view is they did it by accumulating capital and human capital a kind of more modern view is saying intangible capital is critical how they how they organize production bring new methods into organizing production to increase productivity and that's known as intangible capital and I think of state capacity as a kind of key form of intangible capital if you look through history at key events in the history of many countries in which they built effective state capacity it has been by reorganizing the state not just by spending more money on physical capital of any kind but actually realizing that a better form of organization is needed to deliver on specific things that the state does and state capacity in that world if you believe the top down approach is about creating these in these investments particularly in intangibles the other the other kind of more bottom-up view is that cohesive polities emerge from a stronger social contract and I'm going to talk about this later so I wouldn't say any more about this now and the first I think is is well understood the second is work in progress where does trust fit into it so I put trust in my title I'm going to talk about trust a lot we know that there's a very big literature and actually I think it was even touched on in sessions I was I participated in the audience yesterday trust figures as central bellwether of effective societies and interpersonal trust allows enforcement of contracts and cooperating in the provision of public goods trust in government again has been massively studied by particularly political scientists less so by economists is distinct but related there's an interesting debate and not one I'm going to have time to go and do today about whether there's a kind of tension between interpersonal trust and trust in government in the sense that in cases where effective communities operate does that actually push against the possibility of building an effective central state because people trust their community to deliver but not trust the central state so there could even be those two could be intention intentional in the data there is a positive correlation between interpersonal trust and trust in government but that by far and away not just measuring the same thing there's a huge literature and I'm going to come to that later the sort of hook which links that literature to what I'm going to talk about today is the literature on government legitimacy again a kind of slippery concept that that many people have debated and discussed um more among political scientists and lawyers than economists and and also psychologists and that I guess the work I've been most influenced by is Margaret Levy's work I'm going to talk about that later in the talk but also Tom Tyler who's a legal psychologist at Yale if you haven't read his work particularly on trust and we we took evidence from from him when we did our fragile states commission and got very interesting and he's done a lot of work on police legitimacy in particular in fragile context how do you actually achieve a state that the citizens have any trust in particularly policing very interesting work if you don't know the other work that that my my only recently erstwhile colleague John Weigel has been doing is now Berkeley on the Democratic Republic of Congo with field experiments which is very very interesting on the role of legitimacy in building state capacity so I'm going to talk about a few core ideas very briefly and then I want to discuss where trust fits in and then I outline the puzzles a few puzzles on an agenda so here's kind of how I I I kind of generally have thought about state capacity that state capacity emerges because you you can build common interests how do you build common interests it's some combination of building institutions and having norms and values that support those institutions willingness to cooperate in government and to compromise in particular that common interests central to building state capacities they they're institutionalized very often that leads to better economic policy and the outcome that we we in sense all care about which is peace and prosperity comes out at the at the other end what do we know is that underlying cleavages really matter sometimes you get severe headwinds from history geography and culture of things that are very hard to heal and have long run consequences and among the set of institutions that really matter in my playbook that we could debate this is constraints on executive power in other words being able to to have real sanctions against policymakers who don't behave in the public interest ultimately is what matters it's sort of some sometimes and I don't want to accuse anyone the audience of this it sometimes it is forgotten as what I would regard as the core pillar of democracy because of the obsession about conduct of elections and one of the the lessons in the that we drew out of the out of the state fragility commission was that the rush by the international community to run elections in post-conflict societies can be an error before you've built the kinds of executive constraints that means whoever wins that election isn't just going to have a kind of winner takes all mentality so I want to sort of down weight the the the idea that elections are what key to democracy and up wait what is that it's really constraints on power from either legal systems or having genuine power sharing through having an executive that's genuinely accountable to a legislature etc etc okay Torsten and I in our earlier work we kind of rather you know it's always a dangerous thing to to make broad brush generalizations but it didn't stop us we said there are basically three kinds of states in the world cohesive states redistributive states and weak states cohesive states are those that are peaceful and prosperous redistributive states are those that are authoritarian but generally functional and weak states are those that are generally chaotic and dysfunctional and when we did that we did that based on a purely theoretical model so this is the kind of worst way to reach a conclusion for many persons that people's point of view you write down a model and your model tells you there are these three kinds of states well only relatively recently we actually used a machine learning algorithm to do to sort across characteristics of states and used a clustering algorithm to actually ask us if we fed in a whole multi-dimensional vector of things that states do whether it's tax raising or providing support for various kinds of public goods what do we get and and and the answer is this we actually the the clustering algorithm actually comes out with three sets of states in the world based on their ranking on political violence and their ranking on various measures of state capacity and there are basically two dimensions so even in the data it tells you roughly speaking there are two dimensions when you look at the principal components across all of these correlated variables one we call peace and the other one we call state capacity because that's what we're minded to do so and basically these are these two dimensions so the dimension in this dimension is the peace dimension but be clear about one thing we do not classify and I may say a little bit more about this later we do not classify repressive states as peaceful we regard repressive states those that are only able to establish social order because somebody is essentially repressing the opposition is not an acceptable definition of peace in our notion of what's peace and prosperity now that is a kind of controversial statement to throw in here but I think it's a very important statement because a lot of conflicts and think of Syria today simply because of repression by one party on another set of parties we can call that peace if you like I'm very happy for you say that's better than conflict but I think it's an important observation that there are many countries in repressed conflict where one party is essentially repressing the interests of many others and a lot of what we call the redistributive states in our schema are states that are only functional because of widespread use of repression of large groups of citizens that's important because right down here you're going to see one of our middle group states is China China is a highly repressive state it's a relatively peaceful state you wouldn't say it was an open conflict but it achieves that only by having a rule by one group that represses the interests of the majority but what you see are the green states these are the cohesive states these are the redistributive states on the whole you can unpack each of these and decide whether you like their classification this is just what the computer tells you and these are the the weak states that are generally the conflict written states um what's interesting is we we just we took those the classification from here and we plotted it against the world value survey measure of life satisfaction at the country level and you get the following picture namely the the blue the sorry the green states up here are generally the states with high levels of life satisfaction the blue states are in the middle and then the red states around the bottom and that's something we didn't put life satisfaction into the measure and simply it just came out this way so you know having started with a slightly crazy theoretical idea there should be three kinds of states first of all the computer didn't disagree and third of all we just plotted against life satisfaction and it looked the way we would have expected to look now i'm not kind of over claimed by any means but it was sort of a an interesting corroboration so what's trust got to do with it i haven't really talked about that now um trust is central to our understanding of legitimacy and effectiveness of states and as i said earlier that we largely live with two concepts of trust trust in people um either interpersonal trust or trust in elites of one kind or another there's a lot of looking at for example business elites and other other groups and then there's sort of trust in institutions i think one of the big interesting unresolved trust issues that i've never seen satisfactorily resolved is what i call the autopilot versus pilot problem uh in in other words is the way to resolve think about you know i'm about to go on a plane you're probably all going to fly on a plane the next few days you know so what makes you trust the plane when you get on on board there's two ways you can trust the plane one is you trust airbus whoever created it to build a really excellent plane that has all sorts of computerized systems that allow the pilot to do a bad job but the plane will still land safely the other is because you trust the pilot at the end of the day you think it doesn't matter how the plane was made as long as you have a good trustworthy pilot that you know things go wrong it'll be the pilot that rescues you um and trust is a little bit like that there's a big debate about is trust about getting the right people into decision-making positions or is it about designing a more effective equivalent of a more effective plane a more effective set of institutions that mean any any old person can get in and run the show and it doesn't really matter very much because they're so constrained by the institutional environment you know the plane has so many things that mean every mistake the pilot would make would be anticipated by the computer and and and and offset um and you know when we are when we're building trust in society i think we have the same dilemma are we trying to build failsafe things or are we trying to just find better ways of selecting the responsible individuals to run the world of course it's some of both but i think i think in many circumstances you know you have to reflect is it even feasible to do the equivalent of building a better plane or are you basically the end of the day the only way to guarantee trust is to find the kinds of people who are going to behave responsibly when given the the the opportunity to to run the show the great thing about working in this space and many of you will have done this is the just so much data in fact the problem is there is so much data that's very hard to know how to make sense of it um you know we we've been the broader project that this forms part of we've been using Gallup we've been using integrated value survey we've been using barometer surveys we've been using the european social surveys there's just lots and lots of data and the real question is how on earth to make sense of it so i'm going to talk more today about a way of making sense of it than i am about the data although i'm going to show you quite a lot of data just to sort of provide a sort of very casual link this is just for the european subsample if you put a capacity state capacity index on the horizontal axis and a measure of trust in institutions on the vertical axis axis you do find that there i put sloping this would be true if i took a global sample but it gets a little cluttered in the global sample um so i want to just outline very quickly a conceptual framework that i found useful for thinking through some of these issues it's largely motivated by work by margaret levy who has actually become a co-author of mine partly through this process which has been fun margaret for those of you don't know her as a political scientist at stanford and wrote two what i think are really landmark books so i you know if you know nothing else this morning you might go read one of margaret's books if you haven't already um she has a book called of rule and revenue which rather i mean we cited in our earlier work but i didn't really get what she was saying in our earlier work which is a book about building effective states in the 19th century particularly the historical record on the role of taxation and the centrality of taxation in state building um and the second which is i think a little less well known is called consent dissent and patriotism which is why do people volunteer for military service again looking across a variety of countries and the the answer is basically she comes up with two terms in those books the first term this notion of quasi voluntary compliance that what a state can do to be effective is not to to browbeat or to coerce people it's to convince people that it's in their public interest to support various elements to make the state function better the obvious one being to pay your taxes um but but and and and states that rely on heavily on compli on coercive compliance are actually in general more ineffective it's a little bit like my point about it if the only way you can get people to do things in a state is to be extremely repressive and to threaten them in all sorts of ways to do it that doesn't sound like a very peaceful state to me i mean like some others but that doesn't sound like what we mean by a peaceful state what's a peaceful state in a sense is one where people feel a sufficiently strong sense of obligation to want to cooperate with that state and do things that are in the public interest voluntarily or quasi voluntarily to use Margaret's term the other is conditional consent that the idea in in her work on on on on volunteering to fight is that people are willing to volunteer to fight and to put their lives on the line only when they feel that the the goal that the goals of that state are are just if they have a perception that they're being asked to fight in an unjust conflict it's very hard to get people to voluntarily to volunteer for military conflict and on the whole i mean this is a complicated issue i've done a bit of reading on it um um volunteer arm is seemed to be much more effective than coerced armies conscript armies and also paid armies but that's you know i couldn't prove that and i don't know anybody could but the idea that that comes out of this work is that government and citizens are in a kind of reciprocal relationship and that's the foundation of a social contract so how do we think about this there's a kind of anyone's interested i can we have various theoretical papers on this now which spell us out in a sort of usual economic model but think and and and i'm going to slip into into covid a little bit because the covid example is so good for thinking about this problem in terms of the kinds of issues it raises so i might slip into covid a little bit but government faces a policy problem that is very uncertain in the eyes of the citizens and the obvious example is whether to introduce a lockdown during a pandemic for most of us who ever faced that we've never faced anything like it before and the question is when governments asked us to stay at home did we find that the arguments based that was based on compelling or not and you know we have various institutions in different countries designed to try and convince us that we were doing the right thing it's highly uncertain in interesting environments what the right policy is we may never know whether any war that we fight was indeed just or not but what what really matters is that governments have limited capacity to coercively get citizens to do what they want them to do and compliance is costly for many citizens as it was in the pandemic staying at home now as an economist you know you you kind of reach for the economist playbook and you ask yourself what's the best way to think about how people are motivated in such context and of course in the classic economic model which we mistakenly in my view teach to our students we make the self-interest assumption and just say well people will do it if it's in their interest self-interest to do it but if that's the case if that's the right model then pretty much your only hope is to coercively comply them get them to coercively comply if they only going to do it if the if the cost of not complying is going to offset their cost of complying but there's thankfully very compelling evidence that that's a very bad model of how citizens behave in reality that actually citizens are willing to do the right thing when they're convinced that they are doing the right thing and there's lots of work in economics I'm not saying economists have been blind to this but there are lots of also different ways of conceptualizing it so some of you may be familiar with for example Jean Therollum wrote on Banabou's work on pro-social motivation and they have a kind of reputation on signalling model to think about why people are willing to behave in a in a pro-social way but there's lots of different views including by the way just hardwired you know that we have some evolutionary tendency to be pro-social because historically either either culturally or biologically species that develop those pro-social tendencies tend to have been more successful through the history than those that happen but anyway there are lots of ways of conceptualizing this in a model governments announce policy and and and among the things they announce when they announce policy is what what will happen if you don't comply and then citizens choose whether to comply high compliance makes the policy more effective so a lockdown announcing a lockdown is one thing having citizens staying at home is another thing and the end of the day the policy is more effective when more citizens comply with it. Why does trust matter? Well it might matter interpersonally I might ask myself the question why should I comply with this policy if I don't think my fellow citizens are going to do it but also you might make an assessment of whether government is actually implementing this policy for good reasons or bad reasons and that if you look around vaccine hesitancy when it when it really emerged there was a long lot of suspicion among the vaccine hesitant at least in some quarters the survey evidence on this that they thought it was because big pharma was essentially lobbying governments to make a lot of money out of selling vaccines so that would be a mistrusting government I don't really think the government's doing this for good reasons they're doing it because somebody is lobbying them to do it to make a lot of money out of this intervention so that would be a kind of mistrust underpinning of of unwillingness to go along with a particular policy now you can model this if you're an economist you kind of get sucked into economics and and you can model this as kind of base rational citizens updating their beliefs but you can also there's a and in the wider project that I'm working on where this comes out we're also interested in non-base rational versions of this bigly where governments use things like narratives and in fact on Thursday and Friday of this week the Hyatt program at LSE is organizing a symposium of psychologists anthropologists economists I can't remember lots of other disciplines on radical uncertainty and how people actually make decisions and it's I think most people they've already to come to the workshop they've always agreed that the base rational model of economics isn't the greatest model anyway why why why does trust matter in this context trust in government if citizens trust government they're more like to comply I've made that claim I'm going to show you a bit of evidence and government if government why how do you gain the trust of citizens you gain the trust of citizens because you you believe the the the government is motivated to do the thing that is in the public interest this has extensive margin and intensive margin benefits what do I mean by that the extensive margin is certain kinds of interventions are only feasible because you have the trust of your citizens given your limited coercive power so you know some of the interventions again I'll come back to the pandemic some of the interventions that some governments tried during the pandemic were simply infeasible unless you could rely on voluntary compliance because there was no way the state had the capacity to implement them coercively so therefore your only hope of having that policy was the hope that the citizens would buy into it the other is a more intensive margin argument which says conditional on having the policy you just get more compliance so actually it's not whether you have the policy or not it's it's also whether the policy happens effectively what about some evidence I'm going to use six ways of the world value survey and five ways of the European value survey sometimes known as the integrative value survey those who don't know those surveys essentially ask all the same questions there's a bit of work you have to do to integrate them but that basically you can treat them as a single data set it overweights the European sample for obvious reasons but it gives you a slightly bigger data set I'm going to show you a little bit of a state on trust in institutions and attitudes towards voluntary compliance and I'm going to show you there's a really strong association in the data between trust and compliance one thing there's lots of other data sets you can do one thing we've done is using the cohort study in the UK to look at compliance with COVID regulations and you've guessed it people who and you can do this when you actually look at changing trust over time but it's a it's a panel study so people whose trust in the government went down also were less likely to comply so you can even do individual fixed effects and look at the pattern of trust changing over time but I'm going to do all this on cross country data basically I'm going to take the trust question for institutions government institutions from that people are asked to say whether they have a lot of confidence or not in government justice systems and courts parliament police civil service I'm going to just you know I could look at them individually last week I gave a lecture to some civil servants so I pulled out the civil service data to show them which countries had high trust in civil service but I have no mandate today to speak to any particular group in the audience so we're just going to amalgamate those they're very highly correlated as you expect people who are confident in one or other of those institutions are probably confident in others and we just produce the first principal component based on some factor loadings we do the same for a index and again I can do individual things in fact I'll show you a little bit of evidence from individual things in a minute but basically you can have a set of compliance questions and they ask conditional compliance questions in the data they say would you be willing to pay higher taxes to protect the environment you know how far that's related to trust in government you could debate I would you be willing to fight for your nation if called on and is it justifiable to cheat on your taxes now one of the things surprising at least to some people is discover if you look at actually the in about almost half a million observations that we have in the integrated value survey for the justifiable cheat on your taxes about 67 percent of populations think think it is not justifiable to cheat on the taxes so for all the view that people only pay their taxes coercively that really speaks to the Margaret Levy view that actually many people believe you should mind you it reminds me of a story so I'm not going to name names but a right-wing economist who I got to know quite well decided to pull his kids out of the public school system in the US and homeschool them because he was convinced that public schooling was brainwashing his kids into being willing to pay higher taxes so maybe had a point I don't know anyway if you plot an index of voluntary compliance against an index of trust in institutions you will find that that's up and sloping the cross country variation that's not so surprising but the interesting thing is you can look at this within country to and take country fixed effects out and looked at the relationship between voluntary and compliance and trust within countries controlling for anything you can control for in that in that survey and I'm not going to go gloss over this quickly because basically I'm doing the thing you're not meant to do in economics anymore apparently stars are banned now you're not allowed to show stars on regression coefficients partly because anyone only looks at the stars so you give a seminar and you put stars people just ignore all the other coefficients they just look at look at the stars well I'm doing I'm doing that too so these are stars basically the bottom line is this is the question on increasing taxes if used to fight pollution very strong link within countries within countries are looking at individual answers and confidence in government same for willingness to fight for your country same for justifiable to cheat on your taxes interpersonal trust by the way if I put that in I could show you that does not do any work in this so it does suggest that this is specific to trust in government not interpersonal trust a little bit of evidence from the pandemic governments made heavy use of voluntary compliance as we know on things like social distancing vaccine update and wearing masks would be examples we would expect countries with strong traditions of voluntary compliance to make more use sorry of trunk strong traditions of trust and voluntary compliance historically to make more use of voluntary measures during the pandemic and we recently started using it's very messy this is my predoc student he's actually going to do his phd it's time for next year he's chris dan chris chris and i have been trying to use the coronanet data you can download it from this coronanet project what it is is a global effort to code all covid interventions across the globe what governments did when they did it and what kind of method of compliance they use which is why we were particularly interested whether they had to use enforcement or whether they relied on voluntary compliance so what we've done is just to pull out the proportion of covered interventions that relied on voluntary compliance we've only read the data is quite messy so i'm only going to show you it for the european plus us sample eventually not in the not too distant future we'll be able to show this more globally what you find if you take that sample is countries at the top this is the proportion of interventions that relied on voluntary compliance down at the bottom well at the top you have places like demark sweden has finland and then at the bottom you have countries like italy romania and greece and then if you plot that against take the ivs data that i just showed you look at the proportion of interventions that use voluntary compliance that that is upward sloping meaning that countries that have higher levels of voluntary compliance than the ivs tended to be the countries that relied more on voluntary compliance during the pandemic and also it's even you know more striking picture if you look at the trust in state institutions question countries that had much stronger trust in state institutions tended to implement interventions that relied on voluntary compliance so some evidence that governments understand that citizens indeed my co-author torsten passon who's been recently on a post-corona commission in sweden sweden as you know one of the interesting things if you contrast sweden demark and finland they had quite different coroner experiences the common thing that you had in sweden was they relied very very heavily on voluntary compliance and a bit of fair rather badly in the pandemic at least by their own standards of success so there's been a lot of interest in white way that is but i remember talking to torsten very early in the pandemic about the swede the swedish approach we used to call it in britain the swedish approach the swedish approach being just a trust your citizens try and give them advice about the right way to behave and not to spend too much time on coercion anyway okay so the story so far i'm going to wrap up fairly fairly soon the story so far is that elements of voluntary compliance are useful are used in policy they lower cost of implementation they expand the set of feasible policies i haven't really justified it fully there are strong correlations in the data linking willingness to comply in trust in state institutions so of course where we want to go next and i'm not i'm just i'm sort of treading on very well trodden territory here is where that so it really makes us want to think where does trust come from so i just sort of treat a trust as something that's out there and the question is where does it come from and a huge number of people have already tried to contribute to that there's a kind of institutionalist view which i think again is the one economists feel moderately more comfortable about it's like you build a better plane if you want more trust in government you you do the equivalent of making the autopilot work really well that's going to get citizens to trust their government if somebody sets a foot wrong there's either going to be a lawyer or a or a judge on their back or there's going to be a vote against them in parliament you have to improve the institutions that's kind of warm view um and there even there though you know maybe the best way to do it is to improve selection not just incentives the other is to look into into cultural factors the deep-seated determinants where particularly more polarized and fragmented societies maybe find it more difficult to get a feeling of trust what we do know is that there's huge persistence of historical experiences which makes this very difficult to think through and i'll make a few observations and then there's a bigger agenda so one one thing that i will show you to link back to the stuff we did on state capacity is that trust in institutions is much stronger in countries with long histories of strong executive constraints which we would expect if the institutionalist view had any merit it doesn't work so well with democracy by the way and that comes to my point about you really do need to separate out these dimensions of democracy but i won't i won't harp on that now one thing i did literally um right at the 11th hour before this presentation i thought i'd look at average conflict levels between 1975 and 2016 i've said to you we torsten and i are very particular about viewing repression as a different alternative to peace so these are countries that are not an open conflict but according to various measures have severe repression against oppositional forces in the society is sustaining whoever's in power in power and what you see is that the peaceful countries tend to have greater trust in state institutions those countries with some history of civil war have have less trust and then the repressive countries are a little worse than than the peaceful countries or a bit but they're not as bad as the conflict countries so suggesting there may be something interesting here and indeed i'll show you something on that in a minute um there's a very large existing literature so many of you will on but but more on the interpersonal trust front than there is on the trust and government front at least my reading i have read quite a lot of stuff on on this now the the the piece you'll probably many of you will know is this jeep piece which is a kind of meta study of a variety of studies on interpersonal trust and conflict which argues if anything periods of conflict increase interpersonal trust and i think someone referred to that in one of the panels i was at yesterday but but there's much less on how this affects trust in in in government one of the lines of work and i'll finish here that's getting very popular and interesting among economists that trying to to study some of these things is the kind of impressionable years work the idea is that salient events that you encounter in the early years of your life and the some sort of psychological sociopsychological um underpinnings of this idea leave a much bigger lasting impact on your um belief so there was a paper some of you may have seen called growing up in a recession um a few years ago in the review of economics showing that people who grow up in a recession seem to have long lasting different views about redistribution than people who didn't grow up in a recession so taking that idea seriously one can unpack sort of the early years experience of people in these different data sets and and you can do a lot of it because there's a lot of data one of the things that's well known but i'm going to pull this out a little more in a minute is exposure to communism in eastern europe and the persistent effects of that but there's other other things you can do so so in some work with sasha drae which a lot of what i'm talking about today is joined with sasha we've kind of um looked across a whole range of different exposures in impressionable years different things from both political and economic data sets to see how many of those appear to have some correlation with trust in uh government institutions and uh you know we could 24 is what i'm going to show you but you know we could have had 48 probably 72 easily um but here's a few sort of things that we've been looking at is whether you were brought up under colonial rule whether you were young when there was a founding democratic election um founding autocratic election whether whether there was a consumption disaster whether there was some kind of systemic crisis banking crisis currency crisis inflation etc etc um and uh and mostly and and i'm not this is the full 24 so we didn't pick them because we had some stars to show you we just picked a load of indicators and just decided to show you what what comes out one of the interesting ones is civil war down here so if you were brought up in a civil war in um your impressionable years which is defined to be less than 25 um then you tend to have less trust in government as a consequence so this is very much work in progress this was done literally in the last few few few days um of course the the last refuge of scoundrels is is going to be why are we doing this because we were interested in the possibility of an iv approach where we use these first stages of impressionable years to predict your confidence in government to then ask whether the voluntary compliance relationship that i showed you earlier um is robust to instrumenting trust and the answer is yes if you use some of these indicators but again that's work in work in progress something that a lot of people have observed um is is the this is just for europe the the legacy of communism in europe is is one of mistrust this is a confidence map confidence in government map for europe um and uh although sort of defining this as all europe is a little perhaps a little geographic and stretching but anyway this is russia of course um on the whole you see much less trust in the former communist countries um if you then look at cohorts of people within those countries according to whether they were or are not actually brought up under communism you get strong relationships between confidence and government so people who lived under communism are today still less trusting of government than the people who were not exposed to communism living in the same countries even controlling for age um the same for the number of years of exposure to that and that shows up in trust in institutions and in um and involunt and the voluntary compliance index i showed you from the integrator value survey which again suggests that when we're trying to look and understand what we might be up against if we think this trust compliance state capacity nexus is important is um sort of headwinds from major historical events one one calculation i was actually doing this on the plane so i couldn't show you it today by the way i'm i'm sure many of you have experienced planes were a place i have always used to get any work done now i know i was so unproductive during covid um no internet and you just sit there on the plane and you work anyway so watch the productivity effect of me being allowed to travel again i've been much more anyway i was doing this kit back of envelope calculation because you can ask given the age structure of a population if that population was exposed to a significant negative shock what is the speed of convergence at which that that effect will go away so how long is the legacy given the size of the effect how long is the legacy of communism going to last i mean is it going to be 20 years into the future 30 years into the future when do we expect if nothing else happens of course which never is going to be the case what is the speed of convergence and you can use the type of calculations given rates of migration which you also have to take into account and birth and death rates the speed at which there'll be kind of cultural convergence um based on these type of estimates which i think is an interesting back of the envelope thing to do say how how big are these effects and how long will they last okay so so i've i've i've offered you a bit of a canter through a lot of things and i'm sure i've hopefully provoked you into into thinking about a few of them um what i what i've tried to do is to outline that we should be giving a more central role to the to this to to trusting government in to being central to the way we think about this nexus of peace prosperity state capacity that somehow trust belongs in there and hasn't perhaps been sufficiently central i'm very intent and and and this is important that the part of what we were doing uh in the work we taught us earlier is in integration what what we noted there were these different literatures all going off in their own directions not speaking to each other one example was the literature on conflict and the literature on state capacity were not really being linked and so all we were trying to do was to link them so so i'm not claiming today that i'm kind of going off in new direction what i'm trying to do is to say we need an integrated understanding of these issues that doesn't just say oh i study trust in government and i'm going to study totally in isolation from being interested in conflict being interested in state bill it's gotta all be integrated and that's the thing i want you to take away um but it means we need to get into studying the origins of trust the institutional cultural factors and and also what do we mean by trust building so i've been doing somewhere i really want to show you this but it hasn't converged at this point on truth and reconciliation commissions around the world and the impact on social attitudes in the countries that have had them that does seem to be some evidence but it's not robust enough i dare show you it that countries have held truth and reconciliation commissions do seem to be creating higher trust among the citizens who were exposed again using time-varying exposure to those things but i i've already over claimed because of the results that i say we're not sure really what we're doing but i think there's some interesting questions about institutional change another wing of this research agenda which may or may not be relevant in different contexts is deliberative processes i've got very interested recently partly because as a policymaker i've said on the national infrastructure commission we've been using deliberative processes to look at receptiveness to various um um policy changes particularly in the environmental space but also looking at public transport versus congestion pricing and other things i do think these deliberative processes are interesting i don't know how far we can push them but i do think they have also potential in this kind of trust building nexus how do you get citizens to buy into things when you talk to them and you try and extract and and educate through through those institutions it's huge so i guess the unsatisfactory part although good for all of us academics is there's a lot still to be learned um and the causal patterns are not likely to be very simple the idea that economics has kind of become this cause this effect is not going to be a strategy i mean it will have a role to play in the bigger picture for sure but there's going to be no simple story at the end that i'm finding some magic bullet if we just do this the world will be different i don't think that's how it's going to look and the dynamics are particularly tricky because these are things that play out typically over at least generations maybe they can be quicker than that but they're gonna they're going to be occurring at a relatively slow pace and therefore we need to think about our time frame in policy which is often urgency versus the realistic time frame for shifting the dial and some of the things i've been talking about today and that's a real challenge both in managing our expectations but also in in thinking how we're going to create a narrative around policy making that is realistic for the people who we're trying to communicate with anyway i've said enough i'm probably too much thank you very much tim thank you for a fascinating lecture especially setting on a very exciting agenda for all of us here on how we should think about trust in the state institutions the part of building state capacity and all the debates on on peace building i'm going to take we're going to take three questions at a time uh from the audience here and also the online audience and i can already see some hands up to just wait for the mic to get to you i have to start with patricia right in front of me oma there and gentleman there so first let's just take this three questions together thank you very much tim that was uh excellent talk not unexpected thank you um one uh question about trust i guess more a comment uh we actually have been discussing about this paper we have colleagues here at unwide where we recover the same result that uh that trust in govern in governments are associated with compliance during covid but then we start asking the question where is trust coming from and one of the big effects we find is the 2007 2008 financial crisis which have led to this massive reduction in trust in europe and then we find this interesting result which is uh people affected by the crisis and this massive reduction in trust actually seem to uh obey more the the the the public health policies but it turns out it's not because they trust the state it's just because they do not trust the state to actually provide what they need so they kind of go into themselves and something that appears to be compliance is actually not compliance is people actually having a deep mistrust of the state so i wonder what are your thoughts about this kind of more subtle interpretation of this thanks patricia all our please great thanks very much i wanted to ask you about the implication of your argument for ethnic diversity and national identity so we have a a reasonably robust amount of evidence now that shows there's a negative relationship between social cohesion and ethnic diversities and societies so and in fact some of that in fact has been traced to foreign born populations that where you have countries with high levels of immigrant based diversity uh that we see lower levels of social cohesion and the cause of logic being that individuals who may come from different countries the relationship between state and society is very different and their levels of trust in public institutions is very different so what does that then mean for i guess our policies around integration and our policies around immigration and more generally i wonder if you were to substitute in your various empirical correlations that you've attempted ethnic diversity for trust whether you've discovered that they're in fact perhaps trust is just an intervening or an intermediate variable and what might be driving this is indeed just how strong national identities are as important for state capacity thank you thank you very much my name is ben jammin petrini i'm a research fellow at the international institute for strategic studies i'm i'm curious to hear your view on the implications of this work for current fragile states and if you would differentiate the work or the approach on fragile states and on conflict affected countries and so what what would be the difference in the in the approach in those i mean you you hinted in some of your conclusions on on the need to investigate the origins of trust how do we look at trust in countries that have gone through repeated cycles of conflict and violence thank you thanks jim those are fantastic questions i'm going to give very brief answers to maximize the potential participation so forgive me for that um um just on the last question i'll go in in reverse order um the i see adnan khan over there who was on the fragile states commission with me and we had a really interesting experience which i think speaks exactly to a question with the tunisian i think it was the deputy prime minister of tunisia who gave evidence to the fragile states commission and when after the arab spring um when tunisia was an extremely fragile place um uh there was a question about what would be the policy agenda of of the new tunisian government and of course places like the imf and world bank had their own agendas and you know they would have been telling them you know invest in schools or whatever they thought it turns out that the policy that the tunisian government came up with with the time was we are going to clean the mosques and that was a very interesting trust building moment it had two elements one was it was the policy agenda of the country it wasn't the policy agenda of some 26 year old with a phd in economics had been flowing in to give policy advice it was actually something that came from the policy makers themselves and second of all it was not any international policy list no donor no international organization and i think it was a very interesting example of what trust building can mean when and and often it is it is to listen to the people in situ who who understand they're trying to take i mean perhaps do the again another theme in our in our report was pivotal moments you have to trust building can happen at pivotal moments you can lose trust a new government comes in um and and it's very easy for that government to make a mess and to lose trust but you first of all you have to look at the pivotal moment second of all you really do have to think of trust building and it was the thankfully the politicians were very aware of that in a way that external actors were not and i think that's something i'll just raise that as a question you know when you have external actors crawling all over the governments of fragile states telling them what their policy agendas are i don't think that's often the greatest way to build trust because it's it's got to be something that is internally generated now of course that's a much bigger issue than i said but that's a that's a small answer i think the ethnic diversity question very interesting and i can you know the empirical work we're doing is is very much work in progress and i am i can promise you're going to take your suggestion very seriously of seeing where it where it fits into the story um i think i think the thing i take away partly from what you're saying and i think some countries are more aware of this than others is sort of integration how you do integration um of uh of people coming from places with different as you said sort of background cultural values and so forth is absolutely key again i'm not sure we i'm i'm not sure how much we we understand that as an agenda item it's certainly not something that most economists would spend time on hopefully um the uh the um uh uh other social sciences do do worry about this a lot more in fact i know some social psychologists who worry about these issues a lot more but i think you're you're quite right to put the spotlight on this and i i don't i you're quite right to say i didn't talk about this much but it is sort of in the background but i'll i'll i will take your question away um i i on patricius question i mean it's a it's a great point and a subtle point like you make that maybe maybe it really is the case that um that this is indicative of mistrust and i i'm i'm sort of trying to to think about ways where we can test one view versus another and i you know we we should talk some more because i did i did see your paper and it's very very interesting so you make sure everyone in the room is in your paper but and but but i think the other interesting thing that you raise in your paper which is very consistent what i was talking about is um the role of these significant events in the financial crisis was an interesting one i mean um i was a policy maker as can i mention during the during the um the financial crisis and we all partly because we were in sort of not what would have been smoke filled rooms 20 years ago i don't know what they are now but rooms full of people very intensively focusing on the world falling apart um and um you know there was a lot of concern how do we affect how do we stop there being a really long term impact of this single event i think we're sort of slightly disappointed on the whole that the financial crisis didn't change the world at least you know not in observable now in your work you seem to observe exposure to the financial crisis as a defining moment but it is an example of an interesting defining moment that may indeed have had perception effects that are long lasting in which case again the kind of cultural convergence argument would still go how long do we think this effect is going to last can there be an offsetting event that could mean we get back on a more normal these are all interesting questions that come out of it but not ones i have a great answer for thanks Tim so let's see if there are any questions online audience future yes okay let's take a couple questions online audience okay so two questions from the online audience so first from Victor Perez asking about your view about the role of media in boosting or harming trust between population and state and the other one was from Nora Arneo asking or asking any tips on how to begin building the trust when there is there isn't any thank you thanks and there was a question i think from yeah from there yeah sorry yes go ahead yeah go ahead please thank you very much for that wonderful exposition i'm Dr. Svesios our leader i'm a student of David Bloom whom i'm sure you know Michael Reich and Alan Hill so i'm all over the place because i'm no longer really an active researcher working with any university and my question is based on what we have been listening to for some time with in this conference and the fact that research is actually research and we use the past to extrapolate what may happen in the future in your opinion what would it take to work with the present as searchers to search now in real time for us to be able to get the solutions that are relevant in real time because to me it appears that covid has is a watershed which is showing us that moving forward we may have to do things differently so what do you think it would take for for searchers to do that thank you thanks okay three again three brilliant questions um a very quick answers i mean i think the role of the media is a really important issue and also the role of social media in particular and how that's changing the landscape here the the the the answers i don't think we have any very clean evidence on on this i mean you know there are lots of interesting studies of this and so a good example is you know to what extent does the media get to misreport or report the misdemeanors of politicians for example that would be one big question so one thing you do see is a clear array of countries in the data that have very repressed media and very high trust now you can say that's because they're countries where you know everybody is behaving well or these are countries so there's a lot of heterogeneity out there that needs to be that needs to be explored and i don't and again i think it's part of the agenda i don't think we're ever going to conclude at least i hope we're never going to conclude that the best way to achieve trust in politics is to repress the media i i would have a big problem with that but that's that's a longer argument um i'm on the question of what we know about building trust i mean i i kind of come back a little bit to what i said in in in response to an earlier question i i do think it's about trying to legitimize governments in situ not to rely on external actors dictating the agenda i i feel very strongly that one of the mistakes that we made historically was thinking that the international community should be the predominant stirrer of the fortunes of countries and i think we just went too far in that and legitimizing the views of the citizens and trying to build stronger and effective states now of course that we all know that there's nothing controversial i have been what i just said but how you action that and the the the institutionalization of that i still think is a work in in progress and the and the final question really really interesting question which is much bigger than my talk and i i think you hinted this is you know what what do we really do and how do we make research uh uh into policy um again i think one of the issues is is to be grounded in the specific experiences of the places where you're making policy i'm always very i mean maybe i sounded like i was guilty of this from my presentation but i wouldn't dream of taking anything i've shown you today to a country and saying there's some cross country regression that tells me or some cross crunchy relationship that tells me your country needs to do acts you know we we do need contextually ground a bit but one thing and funny enough i was chatting and so adnan who's the chief economist at fcdo so he's like in the firing line with actually translating research into policy um we talked about over over breakfast is that you know maybe we don't reward sufficiently the translation function of of research you know the people who do research get very well rewarded by you know they get glamorous prizes and they get you know attracted to good universities but you know there's a real intermediation role about how do you take research and do you translate it effectively on the ground and you know many of you in the room will be in that business i know but i'm not sure we give that sufficient reward and how we give that reward i don't know but i i would take away that that's perhaps a missing piece of the of the of the puzzle here to make work much more contextual so don't think we had a question don't answer the front and i think i saw two questions from there right yeah okay give your give your hands up adison from the um university of copenhagen um we know that inflation is very effective at destabilizing societies in fact lennon said if you want to destroy capitalism inflation is one way of doing it we've now entered into what seems to be a very high inflation period and um you can take the example say of Sri Lanka at the moment which is having great difficulties with this but but also um if you look at uh yesterday the the governor of the bank of england admitted that we you know we're having really difficulties with um uh with independent central banks coping with the inflationary shock particularly form food prices so over the last 30 years we've built up a lot of public trust in a key institution which is independent central banks and they built credibility and brought down inflation that way but we now seem to be sort of entering into an era where policy makers are saying we're having great difficulty maintaining that credibility and in the case of Sri Lanka they don't really quite know what to do next so i wonder what your observations are on is it where this is another event you know covid was an event events come along in the case of poorer countries those events can overwhelm government institutions trusting government but also in advanced economies as well and what observations you might have on that thank you thank you two questions from there i think yes go ahead so just wait for the mic to get to you hi uh rinchan mirza from university of kent i'd just like to um know your views on the historical origins of of trust if one looks at for instance the colonial experience across vast swathes of let's say south asia you had this system of indirect rule whereby elites were kind of cultivated and preserved through different forms of colonial instruments like the land alienation act or or other forms of you know direct intervention within societies and once you see that colonialism ends and you have entered a post-colonial phase a lot of these institutions or you know weak state capacity in some areas like the frontier regions there wasn't even a state that you didn't have constitutional courts you don't have a police system there are very different ways of controlling these areas and in a lot of cases those systems have pretty much been preserved with slight modifications so my question is without a radical restructuring of economic and political power a clean break from the past how do you see trust can be built up from bottom up into any state institution and if that's even possible thank you um don't darex university of basal actually had pretty much this the same question and so also wanted to ask you more about the historical dimensions of well state formation and then indeed a reflection on the legacy of colonialism but maybe in addition to that if we look more recently at the the vehicles in iraq and afghanistan you see that some western countries that are pretty high up in your graph with trust in in the state actually have done things that may have lowered trust in the state in places like Afghanistan and iraq and so i think we need to be honest about that yeah what would like to hear your thoughts okay so in terms of the the last two questions i'm going to suggest we're having a really really you know i i'm not going to be able to give brilliant answers but that means you know but we're having the right conversation because i do think the right corollary of everything i said is to an even tony's question sort of speaks to this too is you know what are the things we can do and what are the things we don't do includes what we don't do if we're going to think through the world using this lens i think we're we kind of we hid a little bit behind the institutionalist agenda meaning that i mean i think the independent central banks is a very good example that was a triumph supposedly of the 1990s you know we can slay the problem of inflation by creating an institutional fix and that that did work for a close to a generation but even seems to be falling apart it fell apart i would say i have to be a little careful because i was sitting around the table when when we did the first quantitative easing exercise almost globally in the bank of england in 2009 i by the way like everybody in the room i didn't even know what quantitative easing was in 2008 and yet we were doing it in 2009 as routinely as an alternative to conventional monetary policy but the point i'm making is that you know you have to be adept in your conceptualization of what you're doing and the context in which you're doing it to have any chance i i don't know to what extent we can realistically be far-sighted i mean i think you know the interesting thing about again coming to tony's question is you know we are dealing in the present and events that we none of us literally none of us i think would have anticipated two three years ago you know even if we've been far-sighted i think we maybe could have been realizing some of the implications of of inflation a little bit earlier than than we did because of the very loose monetary policies around the world we're having to unwind but by and large these are these are events and it's how you respond to those events that that will define trust i was a child of the 1970s in the sense that i you know i came of age my impressionable years began in the 1970s really during a period of you know in the uk and of incredible macroeconomic turmoil and i think you know my whole perception of the world was was influenced by seeing essentially one policy failure after another and you know it's the debate in where you were brought up and when you were brought up you might have witnessed that in your own context but how you then unwind those effects and also how you deal with the periods of stability i mean when i was on the central bank of very briefly there was this big debate about what was called the great stability or the great moderation which was this period in the mid 1990s of almost no macroeconomic volatility and there was there were even then people were talking about two views was it good luck or good policy and of course what the policymakers wanted the answer to be it was good policy we've cracked this that's never going to happen again so so i think that there's a i think i'm going to encourage you and you wider to to lead the debate perhaps have your one of your future conferences on what we really know about trust building and its consequences because i think all of the questions are revealing there's there's deep-seated historical elements here things that happened in the past that often look like defining moments but then unwind unexpectedly and i think there's just a huge agenda here and i i wish i could stand up here and i can tell you oh you do the following five things and everything works well i think you know we're always trying to use what knowledge we have contextual knowledge we have to try and make the best of a situation but i don't i don't have very easy answers to this whether for example just to come back to Tony's question we are going to see a retreat from the mantra that independent central banks are the answer to everything i mean we we we could have a situation where the politicians say this delegation to expert bodies isn't isn't working anymore we're going to cease back control i think we're a long way from that by the way but you never know so you but but if you look at client so just briefly coming to climate change which i didn't talk very much about but it's exactly that kind of issue is there an institutional fix if we only build the right set of institutions that will lead to an energy transition will all be fine or is it something where we have to shift people's fundamental perceptions and cultural preferences about what they cannot cannot do in their lifestyles that's a much scarier proposition to think that's the only way forward but it may also be the truth you know that we can build all the institutions we like what is clear and and i've seen quite a few people writing about this now and talking about this now is having a bunch of scientists stand on a stage and tell us that two degrees is unacceptable is not working it's pretty clear there's a you know elites people in this room often you've probably got phd's probably more than half look at the in survey data we're all convinced about climate change we're not the people to convince the people to convince are the vast majority of the population who don't have phd's who are not convinced about climate change and think this is all about their governments finding other ways to tax them and do evil things to them i'm exaggerate but you know what i'm saying um so again is it about institutions if we only get the institutional framework right we get enough independent advice or independent bodies on the job we'll fix it like we fixed inflation these are big questions and i'm gratified i know that wider is engaged in all of this but but the question of how we deal with fra with climate change particularly in fragile contexts how we deal with trust building particularly in fragile all big questions and unfortunately i've only just raised the questions in my talk i haven't really provided satisfactory answers and i apologize for that thanks i thought i saw questions uh from this here from the middle so i think i can see two hands one three well if we keep your question very short we can probably get through them so go ahead right there and then those two questions yes thank you very much eva maria aga from you and uvita i'm working with patricia on the study and one other question i had was around this difference between the level of trust and the change in trust and whether we can think of some threshold at which the trust is sufficient for effective state capacity and whether that's an area of research to explore thank you at the back yep uh leo pesachin and why you would that be you find the stood the implication of the argument correctly you seem to be saying that certain societies are peaceful and prosperous for a long time they have citizen bind because for example there are executive constraints or elections and they're going to have high levels of trust and then there is going to be a shock that comes along and things might change and i wonder if there might be an alternative path to trust uh and in that context what about china so we have a society that is repressive that has experienced a great deal of conflict and on all of these services quite interesting we have a very high level of uh interpersonal trust we have a high level of trust and institutions and this appears certainly looking at covet that we also have a very high level of voluntary compliance and so is that a pathway that we're ignoring potentially is there a potential pathway there that's an alternative that we're ignoring because we're actually focusing on experiences that we that are familiar to us on western experiences thanks one more question just one question yeah hi this is a zachara amampoli at the city university of new york um i think i have a question that builds on the previous one which is i'm curious about the the connection between repression and peace that you're drawing um because it seems very important to your conceptual framework and i'm not i can i can go with you some way but uh but i was struck when you showed the the data on how you categorize what constitutes a repressive country and what's not a repressive country because if i think about objective measures of repression i would imagine things like the size of the prison population the size of the police force the size of the military force and of course by that standard you know the us would be number one in most of those things but you didn't classify it as repressive uh whereas china comes out very poorly on those metrics and then i can think of a lot of other cases where you know this understanding of repression seems to be very important to your to your categorizations of these three types of countries um so how did you measure repression what what constitutes a repressive country if not the things that i just mentioned okay well i i'll give short short that i i i love i love that question i mean because i think it it highlights the importance of um of the agenda where we we start to to view all forms of violence and political violence on a kind of continuum like you're saying where we have to think about where different countries are on that on that spectrum and we i mean it's rather arbitrary to take specific indicators so actually just to be honest about where we measure repression we use specifically repression of opposition groups by incumbent governments as our measure of repression but you quite rightly say that's a very particular measure of repression i think the the thing although i sort of invited us to think about this by putting those clusters around the sets of countries i think i think you know there are all forms of both violence and political violence that go on in societies which are often strategic by some group in another wanting to impose their will on others um and and they should be part of what we we study i mean in the narrow sense the thing i wanted to emphasize is that you know when you move from a country in conf in open conflict to one in covert conflict because of repression you know we want to think of that as differently as different to a country that transitions to what you might call meaningful peace where there's diminution of repression but i i think your question shows how important it is to to to raise that up and also the issue of path dependence so so i've spent a lot of time pouring over political histories more than is good for me um and and you're completely right we shouldn't get the we shouldn't invite people to believe there's a sort of single path that all countries would would follow i mean one of the interesting things that i'll just throw out since um uh it's sort of a my own country context fits rather well is this transition out of monarchy if you look around europe there are quite few countries that transition to democracy out of monarchy was their route to that they do actually rather different both constitutionally and politically than the countries that made different forms of transition for example post civil conflict like spain and portugal so each even within that cohesive set there isn't a common history so you have to be very i mean the the real issue is that every country has to have its own game plan if it's going to have any chance of doing this successfully and we shouldn't be for one second suggesting to anyone that there's a kind of um one size fits all this is the path that you have to follow we used to call that in the commission the curse of demarc meaning that you know everybody wants to be like demarc i mean roughly speaking maybe the fins think they're better than them i don't know but anyway roughly speaking everyone's to be like demarc but that's a that's a terrible thing to want to be it not in the sense that being demarc isn't great but being demarc looking at demarc tells you nothing because it's like looking at a wonderful building you know i'll take my favorite building and i think that's a beautiful building um but actually i want to know where did you put the scaffolding and what were the construction methods and how did somebody actually come to put that elevator shaft where they put it or that beautiful corn easing or whatever and looking at a finished building will tell you almost nothing about the construction methods that you use to build that building and we should be spending more time studying the scaffolding and the uh bricks and mortar than we do studying the final building that's the curse of demarc you know we really need to think about how we get there on the on the trust change i think it's really interesting but one of the challenges and i don't think we are really even close to doing this is what are the sort of short and long-term effect so i kind of showed you the early years experience but one of the striking things in britain during the during the covid period was how quickly some people's perceptions of trust changed over months not even years have they shifted permanently we have this particular episode where one of the prime minister's advisors who had covid drove to a location in the north of england completely against the rules and i think i haven't i haven't sort of tried to look at this in the data but it did look as if that just happened to coincide with a period where diminution in trust there was a big diminution in trust so you can provoke it's like the phone booth experiments i don't know if you ever saw this in that well-being literature but it turned out if you went around and put dollar bills in phone booths and then surveyed people's life satisfaction depending on whether they happen to go into a into a phone booth with a dollar bill which they would then put in their pocket and walk out and then they would tell you that life goes really really well for like one hour or something i just discovered a dollar bill in a phone booth you have to be really careful are we looking at very short-term effects where you can provoke an immediate psychological response and what are the more deep-seated long-lived changes that very hard to reverse and i i personally don't think we're even close to be able to map out what is the permanent semi-permanent temporary changes thanks then we've got to bring this keynote lecture to a close i mean in a way what i think two things i feel i took away from your lecture and also the question the audience one is that given that trusting institutions is part dependent historical conditions what are the trigger points that shift you from low trust to high state trust in state institutions equilibrium so how would you switch countries from that and what kind of policies can do that and i think that's a really important question the other important question is exactly the covid 19 example if states can use coercive capabilities to control the pandemic why should the incident device why why why should they be interested in voluntary compliance so then the straight up between coercive capacity and voluntary compliance and exactly what's the balance in that and i think that's also important question especially in many societies we have authoritarian systems so let me let's bring this lecture to a close we're going to have coffee and we have some very interesting fireside chats happens i think some of which are happening in this room so let's take a break we'll come back at 11 30 thanks


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