Experimental Economics

, Volume 9, Issue 3, pp 193–208 | Cite as

Decomposing trust and trustworthiness

Article

Abstract

What motivates people to trust and be trustworthy? Is trust solely “calculative,” based on the expectation of trustworthiness, and trustworthiness only reciprocity? Employing a within-subject design, we run investment and dictator game experiments in Russia, South Africa and the United States. Additionally, we measured risk preferences and expectations of return. Expectations of return account for most of the variance in trust, but unconditional kindness also matters. Variance in trustworthiness is mainly accounted for by unconditional kindness, while reciprocity plays a comparatively small role. There exists some heterogeneity in motivation but people behave surprisingly similarly in the three countries studied.

Keywords

Trust Reciprocity Social preferences Cross-cultural experiments 

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

Supplementary material

10683_2006_Article_9122.pdf (656 kb)
Supplementary material (656 KB)

References

  1. Alesina, A., & La Ferrara, E. (2002). Who Trusts Others? Journal of Public Economics, 85, 207–234CrossRefGoogle Scholar
  2. Andreoni, J. (1990). Impure Altruism and Donations to Public Goods: a Theory of Warm-Glow Giving. Economic Journal, 100, 464–477CrossRefGoogle Scholar
  3. Andreoni, J., & Miller, J. (2002). Giving according to GARP: an Experimental Test of the Consistency of Preferences for Altruism. Econometrica, 70, 737–753CrossRefGoogle Scholar
  4. Ashraf, N., Bohnet, I., & Piankov, N. (2005). Decomposing Trust and Trustworthiness. Working paper: Kennedy School of Government, Harvard UniversityGoogle Scholar
  5. Berg, J., Dickhaut, J., & McCabe, K. A. (1995). Trust, Reciprocity, and Social History. Games and Economic Behavior, 10, 290–307CrossRefGoogle Scholar
  6. Bohnet, I., & Zeckhauser, R. (2004). Trust, Risk and Betrayal. Journal of Economic Behavior and Organization, 55, 467–485CrossRefGoogle Scholar
  7. Bolton, G., & Ockenfels, A. (2000). A theory of equity, reciprocity and competition, American Economic Review, 90, 166–193CrossRefGoogle Scholar
  8. Brandts, J., & Charness, G. (2000). Hot vs. cold: sequential Responses and Preference Stability in Experimental Games, Experimental Economics, 2, 227–238Google Scholar
  9. Camerer, C. F. (2003). Behavioral Game Theory. Princeton: Princeton University PressGoogle Scholar
  10. Camerer, C. F., & Fehr, E. (2004). Measuring Social Norms and Preferences Using Experimental Games: A Guide for Social Scientists. In J. Henrich, R. Boyd, S. Bowles, C. Camerer, E. Fehr and H. Gintis (eds.), Foundations of Human Sociality. Oxford: Oxford University PressGoogle Scholar
  11. Cardenas, J. C., & Carpenter, J. (2005). Three Themes on Field Experiments and Economic Development. Working paper: Middlebury CollegeGoogle Scholar
  12. Charness, G., & Rabin, M. (2002). Understanding Social Preferences With Simple Tests. Quarterly Journal of Economics, 117, 817–869CrossRefGoogle Scholar
  13. Costa-Gomez, M. A., & Weizsäcker, G. (2003). Stated Beliefs and Play in Normal-Form Games. MimeoGoogle Scholar
  14. Cox, J. C. (2004). How To Identify Trust and Reciprocity. Games and Economic Behavior, 46, 260–281CrossRefGoogle Scholar
  15. Cox, J. C., Friedman, D., & Gjerstad, S. (2005). A Tractable Model of Reciprocity and Fairness. Working paper: University of ArizonaGoogle Scholar
  16. Croson, R. (2000). Thinking Like a Game Theorist: factors Affecting the Frequency of Equilibrium Play. Journal of Economic Behavior and Organization, 41, 299–314CrossRefGoogle Scholar
  17. Croson, R., & Gneezy, U. (2004). Gender Differences in Preferences. Working paper: Wharton School, University of PennsylvaniaGoogle Scholar
  18. Dufwenberg, M., & Kirchsteiger, G. (2004). A theory of sequential reciprocity. Games and Economic Behavior, 47, 268–298CrossRefGoogle Scholar
  19. Dufwenberg, M., & Gneezy, U. (2000). Measuring Beliefs in an Experimental Lost Wallet Game. Games and Economic Behavior, 30, 163–182CrossRefGoogle Scholar
  20. Eckel, C. C., & Wilson, R. K. (2004). Is Trust a Risky Decision? Journal of Economic Behavior and Organization, 55, 447–466CrossRefGoogle Scholar
  21. Falk, A., & Fischbacher, U. (2006) A Theory of Reciprocity. Games and Economic Behavior, 54, 293–315CrossRefGoogle Scholar
  22. Fehr, E., & Schmidt, K. (1999). A Theory of Fairness, Competition and Cooperation. Quarterly Journal of Economics, 114, 817–868CrossRefGoogle Scholar
  23. Fehr, E., & Schmidt, K. (2002). Theories of Fairness and Reciprocity—Evidence and Economic Applications. In M. Dewatripont, L. P. Hansen, and S. J. Turnovsky (Eds.), Advances in Economics and Econometrics—8th World Congress, Econometric Society Monographs. Cambridge: Cambridge University PressGoogle Scholar
  24. Glaeser, E. L., Laibson, D. I., Scheinkman, J. A., & Soutter, C. L. (2000). Measuring trust. Quarterly Journal of Economics, CXV, 811–846CrossRefGoogle Scholar
  25. Greig, F., & Bohnet, I. (2005). Is There Reciprocity in a Reciprocal-Exchange Economy? Evidence on Gendered Norms from a Slum in Nairobi, Kenya. Working paper: Kennedy School of Government, Harvard UniversityGoogle Scholar
  26. Hardin, R. (2002). Trust and trustworthiness. New York: Russell SageGoogle Scholar
  27. Kahneman, D., Knetsch, J., & Thaler, R. (1986). Fairness as Constraint on Profit Seeking: entitlements in the market. American Economic Review, 76, 728–741Google Scholar
  28. Kosfeld, M., Heinrichs, M., Zak, P. J., Fischbacher, U., & Fehr, E. (2 June 2005). Oxytocin Increases Trust in Humans. Nature, 435, 673–676CrossRefGoogle Scholar
  29. Kramer, R. (1999). Trust and Distrust in Organizations: emerging perspectives, Enduring Questions. Annual Review of Psychology, 50, 569–598CrossRefGoogle Scholar
  30. Laury, S. (2002). Pay One or Pay All: Random Selection of One Choice for Payment. Mimeo: Georgia State UniversityGoogle Scholar
  31. Mansbridge, J. (1999). Altruistic trust. In M. E. Warren (Eds.), Democracy and trust (pp. 290–309). Cambridge: Cambridge University PressGoogle Scholar
  32. Ostrom, E., & Walker, J. (2003). (eds.), Trust and Reciprocity. New York: Russell SageGoogle Scholar
  33. Ortmann, A., Fitzgerald, J., & Boeing, C. (2000). Trust, Reciprocity, and Social History: a re-examination. Experimental Economics, 3, 81–100Google Scholar
  34. Rabin, M. (1993). Incorporating Fairness into Game Theory and Economics. American Economic Review, 83, 1281–1302Google Scholar
  35. Rabin, M. (2000). Risk Aversion and Expected-Utility Theory: a Calibration Theorem. Econometrica, 68, 1281–1292CrossRefGoogle Scholar
  36. Roth, A. E., Prasnikar, V., Okuno-Fujiwara, M., & Zamir S. (1991). Bargaining and Market Behavior in Jerusalem, Ljubliana, Pittsburgh, and Tokyo: An Experimental Study. American Economic Review, 81, 1068–1095Google Scholar
  37. Rotter, J. (1980). Interpersonal trust, trustworthiness and gullibility. American Psychologist, 35, 1–7CrossRefGoogle Scholar
  38. Schechter, L. (forthcoming). Traditional Trust Measurement and the Risk Confound: an Experiment inRural Paraguay. Working paper: University of California at Berkeley. Journal of Economic Behavior and Organization Google Scholar
  39. Williamson, O. E. (1993). Calculativeness, trust and economic organization. Journal of Law and Ethics, 36, 453–486Google Scholar

Copyright information

© Economic Science Association 2006

Authors and Affiliations

  1. 1.Harvard Business SchoolBoston
  2. 2.Kennedy School of GovernmentHarvard UniversityCambridge
  3. 3.Analysis GroupBoston

Personalised recommendations