Financial stress and economic growth: The moderating role of trust
研究信任能否缓解金融压力对经济增长的负面影响，基于2002-2020年欧盟国家数据发现，信任通过促进家庭消费和企业投资发挥调节作用，且该效应受经济自由度和政府意识形态影响。
Abstract The literature suggests that trust can influence the behavior of economic agents and improve access to financing for both households and corporations. Subsequently, this might have implications for the consumption of households and the investments of corporations. Therefore, trust could mitigate the negative impact of financial stress on economic growth. To test this hypothesis, we use a sample of EU countries over the period 2002–2020 and examine the interaction of trust with financial stress in shaping GDP growth. The interaction term enters the estimations with a positive and statistically significant coefficient, and it therefore mitigates the negative impact of financial stress on economic growth. Furthermore, by disaggregating the GDP into its four main components, we find that the moderating effect of trust flows through the two main components of GDP mentioned above, namely households’ consumption and firms’ investments. Additionally, we observe that the interaction effect becomes weaker in countries with a higher economic freedom and is strengthened in centre and left‐wing governments compared to right‐wing economically oriented ones.