The Trust Revolution: How the Digitalization of Trust Will Revolutionize Business and Government.

• Author: Ferracuti, Elia
• Position: Book review

The Trust Revolution: How the Digitalization of Trust Will Revolutionize

Business and Government

By M. Todd Henderson and Salen Churi

New York: Cambridge University Press, 2019.

Pp. xvii, 215. $29.99 paperback.

The Trust Revolution provides an account of the role that trust plays in improving human conditions and of how technology can shape that role. These topics can appeal to a broad audience that spans from those interested in the economic success of societies to those curious about the implications of recent technological innovations for human relations. Hence, I believe that the book fits quite nicely with readers of The Independent Review.

The Trust Revolution can appeal to such a broad audience because it brings together two very important issues. On the one hand, the first part of the book, loosely from chapter 1 to chapter 6, resembles and draws from previous work studying the conditions that facilitate human flourishing. In this respect, the book can be linked to work such as Adam Smith's Wealth of Nations and Daron Acemoglu and James A. Robinson's Why Nations Fail: The Origins of Power, Prosperity, and Poverty (New York: Crown, 2012).

The second part of the book, on the other hand, studies the implications of the technological development behind the emergence of the sharing economy for the provision of trust. In this respect, the book is related with two recent books: The Sharing Economy: The End of Employment and the Rise of Crowd-Based Capitalism by Arun Sundararajan (Cambridge, Mass.: MIT Press, 2016) and Tomorrow 3.0: Transaction Costs and the Sharing Economy by Michael C. Munger (New York: Cambridge University, 2018).

In my opinion, the greatest strength of The Trust Revolution is the authors' ability to provide a new framework to analyze some of the recent technological developments and to better understand and predict how different agents in the economy react to these developments. Their use of the economic framework of demand and supply to study the provision of trust appears particularly fruitful in highlighting how many of the policy responses to new technological developments may be driven by regulators' concerns over their own diminished importance as trust providers rather than by genuine interest in the welfare of consumers. In this sense, the book shows how recent appeals to the "sharing economy" to approach regulation in a more proactive way may be ill posed and hopeless. For example, the book helps the reader see how statements such as "Regulation is often the most significant barrier to future growth for sharing economy firms. This is particularly...