INTRODUCTION

Chapters 3 and 4 provided a comparative account of the relationship between institutions and trust. This chapter turns to a different task – that of explaining change in patterns of trust and cooperation over time. In particular, it seeks to explain how changes in informal institutions may lead to changes in patterns of trust. As discussed in Chapter 4, informal institutions of the right kind can support thick forms of trust among actors, while effective formal institutions are more likely to produce institutional compliance than trust as such. This suggests that one very important mechanism driving changes in trust and cooperation among economic actors is likely to be a change in the informal institutions that support them.

These specific arguments about changes in informal institutions offer insights into more general debates about how and whether national and local institutions are being affected by exogenous shifts in the international economy. As local and national economies become increasingly interpenetrated with each other, actors' opportunity structures will change: some of them will begin to take advantage of new external options that were previously unavailable to them.

Although the consequences of these changes for existing institutions have received considerable attention in the literature, they are still the subject of controversy. Many authors have claimed that cooperation intensive forms of production are being corroded by the logic of an Anglo-American style free market economy (Ohmae 1990; Greider 1997; Friedman 2000). However, not only does much of this work lack either rigor or properly developed arguments about the relevant causal mechanisms but it also fails almost completely to take proper account of how institutions may intermediate change (Campbell 2004).