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Trust and trustworthiness under information asymmetry and ambiguity

Author

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  • Clots-Figueras, Irma
  • González, Roberto Hernán
  • Kujal, Praveen

Abstract

We introduce uncertainty and ambiguity in the standard investment game. In the uncertainty treatment, investors are informed that the return of the investment is drawn from a publicly known distribution function. In the ambiguity treatment, investors are not informed about the distribution function. We find that both trust and trustworthiness are robust to the introduction of these changes.

Suggested Citation

  • Clots-Figueras, Irma & González, Roberto Hernán & Kujal, Praveen, 2016. "Trust and trustworthiness under information asymmetry and ambiguity," Economics Letters, Elsevier, vol. 147(C), pages 168-170.
    • Handle: RePEc:eee:ecolet:v:147:y:2016:i:c:p:168-170
    DOI: 10.1016/j.econlet.2016.08.019
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    References listed on IDEAS

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    1. Cox, James C., 2004. "How to identify trust and reciprocity," Games and Economic Behavior, Elsevier, vol. 46(2), pages 260-281, February.
    2. Johnson, Noel D. & Mislin, Alexandra A., 2011. "Trust games: A meta-analysis," Journal of Economic Psychology, Elsevier, vol. 32(5), pages 865-889.
    3. Daniel Ellsberg, 1961. "Risk, Ambiguity, and the Savage Axioms," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 75(4), pages 643-669.
    4. Berg Joyce & Dickhaut John & McCabe Kevin, 1995. "Trust, Reciprocity, and Social History," Games and Economic Behavior, Elsevier, vol. 10(1), pages 122-142, July.
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    Cited by:

    1. Chen Li & Uyanga Turmunkh & Peter P. Wakker, 2019. "Trust as a decision under ambiguity," Experimental Economics, Springer;Economic Science Association, vol. 22(1), pages 51-75, March.
    2. Fooken, Jonas, 2023. "Trusting when risk and ambiguity create opportunities for exploitation," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 103(C).
    3. Ho Fai Chan & Martin Brumpton & Alison Macintyre & Jefferson Arapoc & David A Savage & Ahmed Skali & David Stadelmann & Benno Torgler, 2020. "How confidence in health care systems affects mobility and compliance during the COVID-19 pandemic," PLOS ONE, Public Library of Science, vol. 15(10), pages 1-18, October.
    4. van den Akker, Olmo R. & van Assen, Marcel A.L.M. & van Vugt, Mark & Wicherts, Jelte M., 2020. "Sex differences in trust and trustworthiness: A meta-analysis of the trust game and the gift-exchange game," Journal of Economic Psychology, Elsevier, vol. 81(C).

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    More about this item

    Keywords

    Investment game; Uncertainty; Ambiguity; Trust; Trustworthiness;
    All these keywords.

    JEL classification:

    • A1 - General Economics and Teaching - - General Economics
    • C9 - Mathematical and Quantitative Methods - - Design of Experiments
    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty

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