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The Coevolution of Trust and Institutions in Anonymous and Non-anonymous Communities

  • Werner Güth


  • Axel Ockenfels


We report on a research program that employs the indirect evolutionary approach to analyze how the institutional environment drives the evolution of trust and trustworthiness through the evolution of moral preferences, and how in turn the evolution of preferences shapes the evolution of the rules of the game. In particular, we describe how the ability to detect trustworthiness in non-anonymous communities supports the evolution of trust and thus crowds out legal institutions. If anonymous interaction prevents type detection, legal institutions such as courts and legal insurance may play a decisive role for the emergence of trust.

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Paper provided by Max Planck Institute of Economics, Strategic Interaction Group in its series Papers on Strategic Interaction with number 2002-07.

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Length: 21 pages
Date of creation: Mar 2002
Date of revision:
Handle: RePEc:esi:discus:2002-07
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  1. Werner Gueth & Axel Ockenfels, 2000. "Evolutionary Norm Enforcement," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 156(2), pages 335-, June.
  2. G Th, Werner & Ockenfels, Axel, 2005. "The coevolution of morality and legal institutions: an indirect evolutionary approach," Journal of Institutional Economics, Cambridge University Press, vol. 1(02), pages 155-174, December.
  3. Selten, Reinhard, 1983. "Evolutionary stability in extensive two-person games," Mathematical Social Sciences, Elsevier, vol. 5(3), pages 269-363, September.
  4. Max Albert & Erich Kirchler & Werner Güth & Boris Maciejovsky, 2001. "Exploring Behavior: An Ultimatum Experiment," Homo Oeconomicus, Institute of SocioEconomics, vol. 18, pages 353-375.
  5. Michi Kandori, 2010. "Social Norms and Community Enforcement," Levine's Working Paper Archive 630, David K. Levine.
  6. Brosig, Jeannette, 2002. "Identifying cooperative behavior: some experimental results in a prisoner's dilemma game," Journal of Economic Behavior & Organization, Elsevier, vol. 47(3), pages 275-290, March.
  7. Selten, Reinhard, 1988. "Evolutionary stability in extensive two-person games - correction and further development," Mathematical Social Sciences, Elsevier, vol. 16(3), pages 223-266, December.
  8. Axel Ockenfels, 2002. "Reputationsmechanismen auf Internet-Marktplattformen - Theorie und Empirie -," Papers on Strategic Interaction 2002-46, Max Planck Institute of Economics, Strategic Interaction Group.
  9. Ockenfels, Axel & Selten, Reinhard, 2000. "An Experiment on the Hypothesis of Involuntary Truth-Signalling in Bargaining," Games and Economic Behavior, Elsevier, vol. 33(1), pages 90-116, October.
  10. Axel Ockenfels, 2002. "New Institutional Structures on the Internet: The Economic Design of Online Auctions," Papers on Strategic Interaction 2002-08, Max Planck Institute of Economics, Strategic Interaction Group.
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