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Trust between individuals and groups: Groups are less trusting than individuals but just as trustworthy

Author

Listed:
  • Kugler, Tamar
  • Bornstein, Gary
  • Kocher, Martin G.
  • Sutter, Matthias

Abstract

We compare the behavior of groups and individuals in a two-person trust game. The first mover in this game, the sender, receives an endowment and can send any part of it to the responder; the amount sent is tripled, and the responder can then return to the sender any portion of the tripled sum. In a 2 × 2 design, the players in the roles of sender and responder are either individuals or groups of three players (who conduct face-to-face discussions to decide on a collective group strategy). We find that groups in the role of sender send smaller amounts than individuals, and expect lower returns. In particular, groups send nothing more often than individuals do (and are even more likely to do so when the responder is another group). Groups and individuals in the role of responder return on average the same fraction of the amount sent. Hence, we conclude that groups are less trusting than individuals, but just as trustworthy.

Suggested Citation

  • Kugler, Tamar & Bornstein, Gary & Kocher, Martin G. & Sutter, Matthias, 2007. "Trust between individuals and groups: Groups are less trusting than individuals but just as trustworthy," Munich Reprints in Economics 18202, University of Munich, Department of Economics.
    • Handle: RePEc:lmu:muenar:18202
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    JEL classification:

    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior

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