IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

Trust, Values and False Consensus

Author Info

Listed author(s):
  • Butler, Jeffrey V.

    ()

    (Einaudi Institute for Economics and Finance)

  • Giuliano, Paola

    ()

    (University of California, Los Angeles)

  • Guiso, Luigi

    ()

    (Einaudi Institute for Economics and Finance)

Abstract

Trust beliefs are heterogeneous across individuals and, at the same time, persistent across generations. We investigate one mechanism yielding these dual patterns: false consensus. In the context of a trust game experiment, we show that individuals extrapolate from their own type when forming trust beliefs about the same pool of potential partners – i.e., more (less) trustworthy individuals form more optimistic (pessimistic) trust beliefs - and that this tendency continues to color trust beliefs after several rounds of game-play. Moreover, we show that one's own type/trustworthiness can be traced back to the values parents transmit to their children during their upbringing. In a second closely-related experiment, we show the economic impact of mis-calibrated trust beliefs stemming from false consensus. Mis-calibrated beliefs lower participants' experimental trust game earnings by about 20 percent on average.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://ftp.iza.org/dp6916.pdf
Download Restriction: no

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6916.

as
in new window

Length: 29 pages
Date of creation: Oct 2012
Publication status: published in International Economic Review, August 2015, 56 (3), 889-915
Handle: RePEc:iza:izadps:dp6916
Contact details of provider: Postal:
IZA, P.O. Box 7240, D-53072 Bonn, Germany

Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org

Order Information: Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Email:


Keywords: trust; trustworthiness; culture; false consensus;

Other versions of this item:

Find related papers by JEL classification:
  • A1 - General Economics and Teaching - - General Economics
  • A12 - General Economics and Teaching - - General Economics - - - Relation of Economics to Other Disciplines
  • D1 - Microeconomics - - Household Behavior
  • Z1 - Other Special Topics - - Cultural Economics

This paper has been announced in the following NEP Reports:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as
in new window


  1. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer;Economic Science Association, vol. 10(2), pages 171-178, June.
Full references (including those not matched with items on IDEAS)

Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. On false consensus
    by chris dillow in Stumbling and Mumbling on 2014-10-28 14:11:06
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as
in new window


Cited by:

  1. Jin, Dawei & Wang, Haizhi & Wang, Peng & Yin, Desheng, 2016. "Social trust and foreign ownership: Evidence from qualified foreign institutional investors in China," Journal of Financial Stability, Elsevier, vol. 23(C), pages 1-14.
  2. Daniele, Gianmarco & Geys, Benny, 2015. "Interpersonal trust and welfare state support," European Journal of Political Economy, Elsevier, vol. 39(C), pages 1-12.
  3. repec:eee:jeborg:v:136:y:2017:i:c:p:186-202 is not listed on IDEAS
  4. Proto, Eugenio & Sgroi, Daniel, 2017. "Biased beliefs and imperfect information," Journal of Economic Behavior & Organization, Elsevier, vol. 136(C), pages 186-202.
  5. Berggren, Niclas & Nilsson, Therese, 2015. "Globalization and the transmission of social values: The case of tolerance," Journal of Comparative Economics, Elsevier, vol. 43(2), pages 371-389.
  6. repec:eee:jeborg:v:137:y:2017:i:c:p:132-144 is not listed on IDEAS

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Access and download statistics

When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp6916. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.