Analysis of Trust as an Instrument of Financial Integration

The purpose of this article is to analyse the effect of trust on governance, money market, and business and to find how that in turn affects the trends in the national and international financial markets. For the growth of financial markets trust of its stakeholders is necessary. Without trust the survival of any of the three, i.e governments, money markets and business is questionable and growth of financial markets uncertain. Democratic good governance is based on the principle of responsiveness of the executive to the expectations of its citizens. Any political disturbance or activity which shakes the public trust in the elected government is bound to destabilise the financial markets as is proved by the cases analysed. Money markets and businesses are also very sensitive to the stakeholders’ behaviourial variations.