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Discriminating strategic reciprocity and acquired trust in the repeated trust-game

  • Sacha Bourgeois-Gironde

    ()

    (IJN - Institut Jean-Nicod - CNRS : UMR8129 - Ecole Normale Supérieure de Paris - ENS Paris - Ecole des Hautes Etudes en Sciences Sociales (EHESS), LEM - Laboratoire d'Économie Moderne - Université Paris II - Panthéon-Assas : EA4442)

  • Anne Corcos

    (LEM - Laboratoire d'Économie Moderne - Université Paris II - Panthéon-Assas : EA4442)

Registered author(s):

    In repeated trust-game offers made by investors can be attributed to strategic reciprocation-based behavior. However, when a trustee is loyal, personal trust can build up between players, in the same way that lack of positive reciprocation on the part of trustees can motivate investors' distrust. Acquired personal trust or distrust and strategic reciprocation of the opponent's offers have then a cumulative and convergent influence on behavior in the trust game and are not prima facie distinguishable. We propose an experimental protocol which discriminates between these two determinants of trust. We furthermore show that acquired trust is the mere outcome of anonymous repeated interactions taking place during the experiment in the sense that it does not co-vary with an initial and independent baseline disposition to trust among investors: acquired trust crowds out background trust. Moreover, offers are sensitive to the amount and variance of trustees' returns. High returns-rate contribute to increase acquired trust between the players while the volatility of trustees' counter-offers makes them perceive as opportunistic, triggers investors' strategic behavior and detriments the acquisition of personal trust.

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    File URL: http://jeannicod.ccsd.cnrs.fr/docs/00/71/34/60/PDF/SBG_AC-economics_bulletin.pdf
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    Paper provided by HAL in its series Post-Print with number ijn_00713460.

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    Date of creation: 07 Jan 2011
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    Publication status: Published, Economics Bulletin, 2011, 31, 1, 177-188
    Handle: RePEc:hal:journl:ijn_00713460
    Note: View the original document on HAL open archive server: http://jeannicod.ccsd.cnrs.fr/ijn_00713460
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    1. Normann, Hans-Theo & Wallace, Brian, 2011. "The impact of the termination rule on cooperation in a prisoner's dilemma experiment," DICE Discussion Papers 19, Heinrich‐Heine‐Universität Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    2. Eckel, Catherine C. & Wilson, Rick K., 2004. "Is trust a risky decision?," Journal of Economic Behavior & Organization, Elsevier, vol. 55(4), pages 447-465, December.
    3. Nava Ashraf & Iris Bohnet & Nikita Piankov, 2006. "Decomposing trust and trustworthiness," Experimental Economics, Springer, vol. 9(3), pages 193-208, September.
    4. Cochard, Francois & Nguyen Van, Phu & Willinger, Marc, 2004. "Trusting behavior in a repeated investment game," Journal of Economic Behavior & Organization, Elsevier, vol. 55(1), pages 31-44, September.
    5. Houser, Daniel & Schunk, Daniel & Winter, Joachim, 2006. "Trust Games Measure Trust," Discussion Papers in Economics 1350, University of Munich, Department of Economics.
    6. McCabe, Kevin A. & Rigdon, Mary L. & Smith, Vernon L., 2003. "Positive reciprocity and intentions in trust games," Journal of Economic Behavior & Organization, Elsevier, vol. 52(2), pages 267-275, October.
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