The wages of trust - The case of child minders

Wielers, R., Aug-1997, In : Rationality and Society. 9, 3, p. 351-371 21 p.

Research output: Contribution to journalArticleAcademicpeer-review

In this paper it is argued that the assumptions of the neoclassical and wage efficiency models do not adequately explain the governance structure of employment relationships. Trust may be a constituent element of at least some employment relationships, e.g, those of child minders. According to the tradition of research in social science, trust is established by gifts. It is argued that in employment relationships in which both employer and employee have a gain and damage potential, gifts will be used to establish a trust relationship. This argument helps to produce new hypotheses about wages and allocation in employment relationships. The model is elaborated for the employment relationships of child minders. It is shown that it is not only job and human capital characteristics that determine wages, but also the financial resources of the parents (or employers). In addition, more personal means of exchange are used to establish trust relationships. It is concluded that the trust argument helps to explain different governance structures in employment relationships.

Original languageEnglish
Pages (from-to)351-371
Number of pages21
JournalRationality and Society
Issue number3
Publication statusPublished - Aug-1997


  • employment relationships, labor markets, trust, EXCHANGE, ECONOMY

ID: 6521817