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Information cost, learning, and trust Lessons from co-operation and higher-order capabilities amongst geographically proximate firms
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. |
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