FOR THE PAST TWO DECADES, trust has been touted as the all-powerful lubricant that keeps the economic wheels turning and greases the right connections – all to our collective benefit. Popular business books proclaim the power and virtue of trust. Academics have enthusiastically piled up study aſter study showing the varied benefits of trust, especially when it is based on a clear track record, credible expertise, and prominence in the right networks. Then along came Bernie. There was “something about this person, pedigree, and reputation that inspired trust,” mused one broker taken in by Bernard Madoff, who confessed to a $65 billion Ponzi scheme – one of the largest and most successful in history. On the surface, Madoff possessed all the bona fides – the record, the résumé, the expertise, and the social connections. But the fact that so many people, including some sophisticated financial experts and business leaders, were lulled into a false sense of security when dealing with Madoff should give us pause. Why are we so prone to trusting?
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