Honesty and trust affect the functioning of the state and the market, and, conversely, the quality of formal rules and institutions has an impact on interpersonal trust. This paper organizes and critiques research on the relationship between trust and government; it stresses the mutual interaction between trust and democracy and the impact of corruption. Given this context, the concluding section discusses the transition process in post-socialist countries, highlighting the tensions between interpersonal trust and trust in public institutions.
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