![Sample our Social Sciences journals, sign in here to start your FREE access for 14 days]({"type":"image" , "src" : "/sda/110822/TOC-Subject-Sample-2021-Social-Sciences.jpg"})
ABSTRACT
We evaluate the effect of institutional trust on the willingness to pay more taxes to support the welfare state. We found a positive effect of institutional trust on the willingness to pay more taxes to support the welfare state irrespective of the empirical approach used. Our instrumental variable analysis shows that causality run from institutional trust to welfare state support. A one-unit increase in institutional trust leads to a 15 percentage point increase in the willingness to pay more taxes to help the needy. Similarly, a one-unit increase in institutional trust leads to a 16 percentage point increase in the willingness to pay more taxes to support public health care and education. Consequently, institutional trust should be viewed as one of the most important mechanisms that protect the welfare state from dismantling and retrenchment. We also found a stronger effect of support for more universal programs such as public health care and education than for helping the needy.
Notes
1In general sense, social significance is about whether society should care about the effect of predictor. Even if effect of predictor is significant in strict statistical sense, it doesn’t mean society should spend time, money, and other resources to address such effect. For instance, in the context of this study, we found that a one-unit increase in institutional trust leads to a 1.3 percentage point increase in the willingness to pay more taxes for public health care and education. Such effect is too low to attract attention of policymakers, health administrators, and international donors and justify spending resources of society to cultivate and maintain institutional trust.
Additional information
Notes on contributors
Nazim Habibov
Nazim Habibov is an associate professor in School of Social Work at University of Windsor, Ontario, Canada. His main areas of interests include the education and health policies in post-Communist countries.
Alex Cheung
Alex Cheung is a doctoral candidate in Department of Mathematics and Statistics at University of Windsor, Canada. He is interested in quasi-experimental methods of evaluation of public programs, such as public education, public health, and public welfare.
Alena Auchynnikava
Alena Auchynnikava is a humanitarian worker in Public Association of Human Rights and Law Respects, Azerbaijan. She is interested in issues of education and its effect on labor market in post-Communist countries.