How trust matters for the performance and legitimacy of regulatory regimes: The differential impact of watchful trust and good-faith trust

Abstract

Trust is expected to play a vital role in regulatory regimes. However, how trust affects the performance and legitimacy of these regimes is poorly understood. Our study examines how the interplay of trust and distrust relationships among and toward political, administrative, and regulatory actors shapes perceptions of performance and legitimacy. Drawing on cross-country survey data measuring trust and distrust among various actors within regulatory regimes, our analysis reveals that relationships of watchful trust in terms of a “trust but verify” attitude among actors are conducive to higher regulatory performance. Conversely, the combination of high trust with low distrust fosters regime legitimacy, while high levels of watchfulness even have a detrimental impact on legitimacy. Our research underscores that actors within regulatory regimes adopt a logic of consequentiality when evaluating and contributing to regime performance. In contrast, for fostering regime legitimacy, a logic of appropriateness appears to be more relevant.