Despite the policy implication of the relationship between government regulations and public trust in government, the direction of the relationship has not been clearly discussed as regulatory policies are both a means and an outcome. Will easing the level of government regulations through regulatory reform increase public trust in government? Or will the level of government regulation increase as trust in government increases? This study seeks to find implications for the future direction of regulatory reform through an empirical analysis of the relationship between government regulations and trust in government. To this end, a total of six government regulatory indices and trust indices were used to conduct a panel regression analysis for 37 OECD countries from 1998 to 2020. As a main result of the analysis, the level of trust in government increases as the level of government regulation is eased. There is also a possibility of a virtuous cycle of regulatory reforms which shows that the increase in the trust level caused by a decrease in the regulatory level will lead to a decline in the level of regulations again. However, some analysis results show that an increase in the trust level may lead to a rise in the government regulation level, making it difficult to come to a clear conclusion regarding the impact of trust in government on regulations.
Nevertheless, when looking at the impact of regulations on trust in government, relaxation of regulations through active regulatory reform may elicit a positive effect with regard to enhancing public trust in the government. This suggests that regulatory reforms are needed not only to revitalize the economy but also to enhance public trust in government.