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How Monitoring Influences Trust: A Tale of Two Faces

Author

Listed:
  • Maurice E. Schweitzer

    (The Wharton School, University of Pennsylvania, Philadelphia, Pennsylvania 19104)

  • Teck-Hua Ho

    (NUS Business School, National University of Singapore, Singapore 119245; Haas School of Business, University of California, Berkeley, Berkeley, California 94720)

  • Xing Zhang

    (Singapore–ETH Center, Swiss Federal Institute of Technology in Zurich, Singapore 138602)

Abstract

Monitoring changes the behavior of those who are monitored and those who monitor others. We studied behavior under different monitoring regimes in repeated trust games. We found that trustees behaved opportunistically when they anticipated monitoring—they were compliant when they knew in advance that they would be monitored, but exploited trustors when they knew in advance that they would not be monitored. Interestingly, trustors failed to anticipate how strategically their counterparts would behave. Trustors misattributed the strategic, compliant behavior they observed as signals of trustees’ trustworthiness. As a result, trustors misplaced their trust when they were unable to monitor their counterparts. We discuss the managerial implications of our results for designing and implementing monitoring systems.

Suggested Citation

  • Maurice E. Schweitzer & Teck-Hua Ho & Xing Zhang, 2018. "How Monitoring Influences Trust: A Tale of Two Faces," Management Science, INFORMS, vol. 64(1), pages 253-270, January.
    • Handle: RePEc:inm:ormnsc:v:64:y:2018:i:1:p:253-270
    DOI: 10.1287/mnsc.2016.2586
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    References listed on IDEAS

    as
    1. Schweitzer, Maurice E. & Hershey, John C. & Bradlow, Eric T., 2006. "Promises and lies: Restoring violated trust," Organizational Behavior and Human Decision Processes, Elsevier, vol. 101(1), pages 1-19, September.
    2. Levine, Emma E. & Schweitzer, Maurice E., 2015. "Prosocial lies: When deception breeds trust," Organizational Behavior and Human Decision Processes, Elsevier, vol. 126(C), pages 88-106.
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    6. Michael P. Haselhuhn & Maurice E. Schweitzer & Laura J. Kray & Jessica A. Kennedy, 2017. "Perceptions of High Integrity Can Persist After Deception: How Implicit Beliefs Moderate Trust Erosion," Journal of Business Ethics, Springer, vol. 145(1), pages 215-225, September.
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    8. Michael P. Haselhuhn & Devin G. Pope & Maurice E. Schweitzer & Peter Fishman, 2012. "The Impact of Personal Experience on Behavior: Evidence from Video-Rental Fines," Management Science, INFORMS, vol. 58(1), pages 52-61, January.
    9. Kim, Peter H. & Dirks, Kurt T. & Cooper, Cecily D. & Ferrin, Donald L., 2006. "When more blame is better than less: The implications of internal vs. external attributions for the repair of trust after a competence- vs. integrity-based trust violation," Organizational Behavior and Human Decision Processes, Elsevier, vol. 99(1), pages 49-65, January.
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