How Trust is Achieved in Free Markets
Cata Policy Report, Vol. XIX, No. 6, November/December 1997
6 Pages Posted: 1 Dec 2003
Suppose the muffler drops off your car in the middle of Iowa. You pull off the interstate and find Joe's Auto Repair. The mechanics at Joe's see that you are from out of state. They know that, regardless of how fairly they treat you, you will not be returning and will not be speaking to other potential customers. Hence, caution is advised. Then you notice a Meineke shop down the road. You will never be returning to that Meineke shop either, but for some reason you have more trust in Meineke.
Keywords: trust, reputation, seal of approval, assurance, promise
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