Feedback and regulation

Here is an interesting example of a feedback loop from The Atlantic, summarizing the NBER study "Regulation and Distrust" by Philippe Aghion, Yann Algan, Pierre Cahuc and Andrei Shleifer (July 3, 2008):

People living under the yoke of corrupt governments tend to want … more government regulation. It’s a vicious cycle: in trusting societies, people act civilly and expect less government interference. In distrustful societies, people act selfishly and expect tighter regulation. But more government corruption leads to less-trusting societies, and citizens will generally “prefer state control to unbridled production by uncivil firms”—even when they know their leaders are crooked.

I wonder if this could be made into part of the story of the rise and decline of nations, an alternative or a supplement to the story the Mancur Olson told.