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The Cultural Transmission of Trust and Trustworthiness

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  • Akira Okada

    (Kyoto University)

Abstract

We consider the cultural transmission of trust and trustworthiness in a trust game with spatial matching a la Tabellini. Players are assumed to enjoy psychological benefits from good conducts. The equilibrium probability that an investor trusts a receiver is a monotonically decreasing function of social distance, and the one that the receiver behaves in a trustworthy manner is non-monotonic. Parents with imperfect empathy transmit their own values to their children through education, and the ratio of individuals with good values globally converges to a stationary point with heterogeneity if educational costs are sufficiently small. Trust and trustworthiness are infl uenced by institutions in different ways. A better "intermediate" enforcement crowds out trust and crowds in trustworthiness.

Suggested Citation

  • Akira Okada, 2018. "The Cultural Transmission of Trust and Trustworthiness," KIER Working Papers 1001, Kyoto University, Institute of Economic Research.
    • Handle: RePEc:kyo:wpaper:1001
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    File URL: http://www.kier.kyoto-u.ac.jp/DP/DP1001.pdf
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    References listed on IDEAS

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    1. Alesina, Alberto & La Ferrara, Eliana, 2002. "Who trusts others?," Journal of Public Economics, Elsevier, vol. 85(2), pages 207-234, August.
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    3. Bisin, Alberto & Verdier, Thierry, 2001. "The Economics of Cultural Transmission and the Dynamics of Preferences," Journal of Economic Theory, Elsevier, vol. 97(2), pages 298-319, April.
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    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

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