Bounded rationality, value systems and time-inconsistency of preferences as rational foundations for the concept of trust
AbstractThis paper intends to contribute to the (bounded rationality) foundations of trust. After reviewing the extant definitions, I establish the formal structure of situations involving trust. In that context, I examine the paradoxical situation of (calculative) trust in simple settings. Then I show how bounded rationality provides a rationale for a concept of trust that goes beyond that calculative notion. Value systems and possible inconsistency of time preferences are shown to be crucial elements.
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Bibliographic InfoPaper provided by IESE Business School in its series IESE Research Papers with number D/567.
Length: 32 pages
Date of creation: 15 Sep 2004
Date of revision:
Trust; Bounded rationality; Value systems; Behavioral decision-making;
This paper has been announced in the following NEP Reports:
- NEP-BEC-2004-11-07 (Business Economics)
- NEP-CBE-2004-11-07 (Cognitive & Behavioural Economics)
- NEP-EVO-2004-11-07 (Evolutionary Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Harvey James, 2002. "The Trust Paradox: A Survey of Economic Inquiries Into the Nature of Trust and Trustworthiness," Microeconomics 0202001, EconWPA.
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