More transparency, more trust: Evidence from anti‐corruption campaign in China

Abstract A large body of literature has emphasized the importance of trust in the process of modernization and marketization due to its key role in reducing transaction cost, coordinating interpersonal relationships, and maintaining social harmony, limited attentions have been paid to the political setting. To address this research gap, our study empirically examines the relationship between governmental anti‐corruption effort and individual's trust. The anti‐corruption campaign since the 18th National Congress of the Communist Party of China can serve as an excellent quasi‐natural‐experiment in this study to measure the extent to which governments devotes themselves to control corruption. Using the trace dataset of China Family Panel Studies (CFPS) surveys over the period 2012 to 2016, we find that there is a positive relationship between exposure to anti‐corruption campaign and personal political and social trust. Furthermore, our results suggest that this positive effect will be more pronounced when people are nonparty members and affiliated with rural communities, while more salient for those located in east region of China. This study contributes to the literature on spillover of government corruption by linking anti‐corruption campaign and individual‐level trust. Moreover, we also add values in the literature on the determinants of personal trust by providing political explanation.