The Evolution of Trust in Central Banks during the Covid Crisis

Korsós, Zoltán and Baranyai, Eszter (2025) The Evolution of Trust in Central Banks during the Covid Crisis. FINANCIAL AND ECONOMIC REVIEW, 24 (1). pp. 29-51. ISSN 2415-9271

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Abstract

This paper examines the evolution of trust in central banks during the Covid-19 pandemic in euro area countries, using the example of the European Central Bank. The study focuses on the effects of the pandemic, but also analyses the role of demographic, economic and political factors. We use a probit model with data from Eurobarometer and the Oxford COVID-19 Government Response Tracker. Our results show that the pandemic led to a decline in institutional trust, though this effect is not specific to central banks. There is a positive relationship between stricter government measures and trust in central banks. Extreme political views – both left-wing and right-wing views – are associated with lower trust in central banks. Our results highlight the co-movements of trust in particular institutions, and draw attention to the need for a deeper understanding of the trust dynamics within extremist groups.

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