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Betrayal Aversion on Four Continents

Author

Listed:
  • Bohnet, Iris

    (Harvard U)

  • Greig, Fiona

    (Harvard U)

  • Herrmann, Benedikt

    (U of Nottingham)

  • Zeckhauser

    (Harvard U)

Abstract

Due to betrayal aversion, people take risks less willingly when the agent of uncertainty is another person rather than nature. Individuals in four countries (Brazil, Switzerland, the United Arab Emirates and the United States) confronted either a binary-choice trust game or a risky decision offering the same payoffs and probabilities. Risk acceptance was calibrated by asking individuals their “minimal acceptable probability” (MAP) for securing the high payoff that would make them just willing to accept the risky rather than the sure payoff. People’s MAPs are significantly higher when another person rather than nature determines the outcome. This indicates betrayal aversion.

Suggested Citation

  • Bohnet, Iris & Greig, Fiona & Herrmann, Benedikt & Zeckhauser, 2006. "Betrayal Aversion on Four Continents," Working Paper Series rwp06-005, Harvard University, John F. Kennedy School of Government.
    • Handle: RePEc:ecl:harjfk:rwp06-005
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    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

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