Trust explains Nordic wealth

High levels of trust forms part of the explanation for the high standard of living in the Nordic region. This is the conclusion in the new Danish book «Social Capital. An Introduction». NordForsk will study the Nordic welfare model more closely through two Nordic Centres of Excellence on Welfare.
The social sciences researchers Gert Tinggaard Svendsen og Gunnar Lind Haase Svendsen estimate that there is a hole in current economic theory. Most experts agree that human capital, such as education and knowledge, explains about half of a country’s economic level. Physical capital, such as natural resources, explains one quarter. But the last quarter is still not explained.

According to Svendsen and Svendsen, this is where social capital comes in. Taking the Danish welfare state as their starting point, they attempt to explain the significance of this invisible form of capital.
The writers estimate that the term social capital has two main advantages. One is that it unites discoveries from different strands of research such as sociology, economy, history and anthropology. The second is that the term seems to constitute a missing link in research, potentially contributing to a new theory on the interaction between visible and invisible forms of capital.

The trust between people and the trust between people and the state is very high in the Nordic region. This is very profitable. The trust “oils” society. And the sum of numerous arrangements based on trust saves society enormous sums, the book claims.

Numerous studies show that a general increase in trust of 10% gives a 0,5% increase in economic growth in a country. In a study of the general level of trust in 86 countries, based on data from World Values Surveys and the SoCap project, Denmark, Norway, Sweden and Finland hold the top four spots.

These findings are identical to the conclusions in the 2005 yearbok of the Nordic Council and the Nordic Council of Ministers “The Nordic region as a global winning region”. The report identifies eight common Nordic values: Trust, equality, low distance to power, inclusion, flexibility, respect for nature, protestant work ethic and aesthetics.