(DP 2009-10) Earning trust with transparency: Performance ratings and trust in local officials in the Philippines

Abstract

As a component of social capital, trust is deemed critical to growth and thus must be cultivated. This paper presents evidence that transparency – the public announcement of local government performance ratings– results in greater trust in local officials. The results are based on the application of propensity score matching techniques on three rounds of household survey dataset collected in a local governance project piloted in 12 local governments in the Phillippines in 2001-2003. With the public announcements, the trust may fall initially and then rise afterwards, suggesting that transparency can earn trust through time. Some policy implications are drawn.