From Vikings to Welfare: Early State Building and Social Trust in Scandinavia
Abstract: The Scandinavian welfare states hold the highest social trust scores in the world. Why? Based on the stationary bandit model by Olson (1993), we first demonstrate that early state building during Viking Age facilitated public good provision and extensive trade. Social trust were probably not destroyed but rather accumulated in the following centuries up till the universal welfare state of the 20th century. Focusing on the case of Denmark, our tentative argument is that social trust was not destroyed through five subsequent phases of state building but rather enhanced. Long-run political stability arguably allows such a self-reinforcing process over time between institutions and social trust.