Trust and trustworthiness in a sequential bargaining game

Abstract

We use a two-person extensive form bargaining game to examine individuals' trusting and reciprocal behavior and how those relate to their scores on a trust survey. In keeping with prior research, we find that the "self-interested" outcome is rejected by a majority of individuals. People who score high on the trust survey are both trusting and are also trustworthy, in that they reciprocate others' trust. But, people with low trust scores often exhibit trust but are not trustworthy. These "inconsistent trusters" seem to be interested in exploiting the trust and trustworthiness of others in increasing their own payoff. JEL Classification: C72, C91PsycINFO classification : 2343, 3020

Drivers of trust and trustworthiness

“…This last point is also the main insight arising from the studies conducted in Chaudhuri et al (2003), Chaudhuri and Gangadharan (2007) and Dasgupta and Menon (2011). They show, with the help of experiments and scores on trust surveys, that people who are trustworthy are also generally more trusting.…”

Trust Games and Beyond

“…Chaudhuri et al (2003) let 76 participants play both roles in a bargaining game with a structure akin to a mini-Trust Game, but with the option for the trustee to (costly) punish if no trust was shown (an option that nobody used). Of the 39 participants who trusted their counterparts and were themselves shown trust when in the trustee role, 18 did not reciprocate, suggesting that people who trust are not necessarily trustworthy.…”

Trustworthiness, Governance, and Wealth Creation

“…Paine, 2003;Post et al, 2002). At the same time, scholars continue to interchange trust and trustworthiness as if the two constructs were identical (e.g., Chaudhuri et al, 2003;Inkpen and Currall, 2004;Weick, 2008).…”