Evaluating the trustworthiness of employees: are choices made as actors perceived as a more reliable signal of trustworthiness?

Abstract

A major challenge faced by managers is to ensure that the employees they hire are trustworthy. One strand of research in experimental economics interpreted responses in moral dilemma games as signals of traits such as trust. However, participants in these experiments responded as observers (unaffected by their choices), not actors (affected by their choices), thereby undermining the reliability of the signals. In our experiment, participants playing the role of employees were divided into those holding deontological and non-deontological values based on their responses as observers and actors in a realistic domain, unlike the conventional trolley or similar dilemmas. Deontological responses predominated when choices were made as observers and utilitarian choices were preferred in the converse case. A three-person trust game was subsequently used to determine if participants playing the role of employers placed greater trust in the responses of employees given as actors or observers. The game also identified employees who reciprocated their trust. In general, employers placed greater trust in deontologists, and employee responses made as actors evoked even greater trust. And while deontological employees were more likely to reciprocate trust, deontological choices made as actors were seen as more reliable signals of trustworthiness. These findings were corroborated empirically by a sample of HR managers. Managers with deontological values preferred employees holding similar values in their role as actors, not observers. Even among non-deontological HR managers, a statistically significant majority preferred deontologists, and of them, the majority placed greater trust on deontological responses given as actors.