Information Cost, Learning, and Trust Lessons from Co-operation and Higher-order Capabilities amongst Geographically Proximate Firms
Year: 1998
Type: preprint
Abstract: In this short paper, I put forward an argument about trust based upon an information cost perspective. I argue that, in different contexts, different origins of trust come to dominate. This is so, because different possible origins of trust have a different information cost, and different contexts have different information availability. Agents learn about this, and place their trust accordingly. I provide an empirical example, and list some traits of information availability between geographically proximate firms. The information cost argument explains why a particular way of trusting is prevalent in some proximate ‘communities’ of agents.
Author: Mark Lorenzen
Institution: Copenhagen Business School
Language: English
Topic: Social Capital and Networks
Subfield: Sociology and Political Science
Field: Social Sciences
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2167537346