Kenneth Arrow, perhaps the most influential economist since John Maynard Keynes in the 20th century, saw trust as a lubricant that promotes cooperative behavior and thus facilitates mutually beneficial financial exchange in the presence of incomplete contracts and incomplete information. Recent research has confirmed the benefits of trusting the government in economic performance. It is also true that declining trust in government agencies (state, judiciary and police) can have detrimental effects on economic performance. The various accounts of recent times not only confirm the decline in confidence in governance but also indicate the need to strengthen the Indian economy to get it out of the deep recession. The economic stimulus is too low, too late.
Our goal is not to continue this investigation — it serves as a backdrop — but to argue that declining trust in government agencies, especially state governments, can have serious consequences. It loses subjective well-being. We do so in two stages. First, we examine the relationship between subjective well-being and belief. Next, we will focus on whether confidence in government agencies has waned and its implications for prosperity. Due to the lack of recent data, we rely on the two rounds of All India Panel-Survey reported in the India Human Development Survey 2015 (IHDS). The first round covers 2005 and the second 2012. Unlike the All India Panel Survey, it specializes in asking questions about changes in subjective financial well-being (SWB). Would you say that today (2012) your home is financially the same, better or worse than it was seven years ago (2005)? So, the focus of this SWB is narrow. However, as it relies on self-reports, it captures a broader perspective, which is also influenced by other factors such as income, assets and affiliation to employment, caste, health and social networks. Another unique feature is the focus on trust in government agencies. Trust is measured by three classes of faith: any faith, some faith and only great faith.
At the all-India level, there was no significant trust in state governments in looking after the people in 2005, with less than 30% of households reporting a lot of confidence. Of these, the majority thought it was the same but the higher proportion was considered better in 2012. Of those who do not have any kind of faith, the vast majority feel the same, and a very small proportion is good. While the opposite is not so clear, the relationship between the level of confidence in the SWB and state governments is moderate.
Although the judiciary is autonomous, its role in delivering justice fairly and promptly has become increasingly controversial in recent years. The majority of households showed great confidence in the judiciary, but a small percentage did not. Among the most confident, the majority remained the same, but thought the higher ratio was better. In contrast, of those who have any kind of faith, the vast majority feel the same, but the lower proportion is better. These comparisons suggest that the relationship between trust in the SWB and the judiciary is moderate.
Justice delivery and the police are interconnected because the latter are responsible for law enforcement. Until the criminalization of politics in the corruption observed in both, trust in these institutions will be systemic.
Contrary to the perceptions of the judiciary, a very small number of households (just 16%) exhibited high confidence in the police, with many not having confidence in their ability to maintain law and order. Among the most confident, the majority felt the same, and the higher proportion felt better. Of those with any kind of confidence, the slightly greater majority are identical, and the lower proportion is better. Thus, the link between trust in the SWB and the police is less than moderate.
What needs to be emphasized, however, is that our statistical analysis, which controls confusing factors (such as income, caste, religion, social networks), has found that these communities vary in strength. Trust things for prosperity.
Between 2005 and 2012 confidence in state governments increased. The proportion of those who have great faith has increased, but the number of those who have no faith has fallen. Confidence in the judiciary has also increased; The proportion of those with high confidence has increased somewhat well, while those without faith have been reduced by almost half. Confidence in the ability of the police to enforce the law increased, while the proportion of those with high confidence increased slightly; Those with some faith have grown considerably; And the unbelievers fell considerably. So, if there is any validity to our analysis, and trust in government agencies increases, SWB is likely to grow. But many recent accounts of declining confidence in the regime are certainly concerned with this cause.
Although the opportunities may seem daunting, a lot can be done. The restored focus on trust in government brings a new dimension to public administration and enhances the role of citizens. However, government needs to be more inclusive, transparent, receptive and effective. It’s easier said than done. But the growing awareness among citizens provides a ray of hope.
Vani S. Kulkarni and Raghav Gaiha Lecturer and Research Associate in Sociology respectively, Population Aging Research Center, University of Pennsylvania