Throughout history, the economies that have flourished are those in which the agreements are sealed with a handshake. Without trust, business treatment based on the consensus that the most complicated details will be clarified later cease to be possible. Without trust, each participant looks around to see how and when they will betray their interlocutors.
Joseph E. Stiglitz, in his book "The Great Divide: What to Do About Unequal Societies," emphasizes the critical role of trust in economic success. He argues that economies that thrive typically rely on agreements grounded in mutual trust, symbolized by a simple handshake. Without this trust, the foundation for effective business interactions disintegrates, as individuals become suspicious and self-serving, leading to a breakdown in collaboration.
In the absence of trust, business negotiations devolve into a perpetual state of caution, where each party is preoccupied with potential betrayal rather than fostering genuine cooperation. Stiglitz illustrates that effective partnerships require openness and a shared belief that complex matters can be addressed collaboratively in the future, which ultimately drives economic growth and societal well-being.
