.S.-county level and for voting by U.S. institutional investors. Lower monitoring via voting relates less negatively to future firm … negative relation between trust and bond spreads. Our evidence supports theory arguing that trust substitutes for monitoring … and has implications for investors’ optimal monitoring effort. …

substituting for costly monitoring. We find consistent evidence that the percentage of votes cast at shareholder meetings is lower … monitoring when trust is high. …

monitoring less when trust is high. …