The effect of the financial crisis on systemic trust

Abstract

Policymakers throughout Europe are faced with the challenge of re-establishing trust, and especially systemic or institutional trust, that has been lost in the wake of the financial crisis. This paper looks at recent empirical evidence concerning the reaction to the crisis in terms of citizens' diminished levels of systemic trust. Special attention is paid to the confidence invested in political institutions at the European and the national level, on the one hand, and in the free market economy, on the other.