Trust in State and Nonstate Actors: Evidence from Dispute Resolution in Pakistan

This paper investigates whether information about improved public services can help build trust in state institutions and move people away from nonstate actors. We find that (truthful) information about reduced delays in state courts in rural Pakistan leads to citizens reporting higher likelihood of using them and to greater allocations to the state in high-stakes lab games. We also find negative indirect effects on nonstate actors and show that these changes are a response to improved beliefs about state actors, which make individuals interact less with nonstate actors and, we argue, induce them to downgrade their beliefs about these actors.