Trust Games Measure Trust
The relationship between trust and risk is a topic of enduring interest. Although there are substantial differences between the ideas the terms express, many researchers from different disciplines have pointed out that these two concepts become very closely related in personal exchange contexts. This raises the important practical concern over whether behaviors in the widely-used â€œtrust gameâ€ actually measure trust, or instead reveal more about risk attitudes. It is critical to confront this question rigorously, as data from these games are increasingly used to support conclusions from a wide variety of fields including macroeconomic development, social psychology and cultural anthropology. The aim of this paper is to provide cogent evidence on the relationship between trust and risk in â€œtrustâ€ games. Subjects in our experiment participate either in a trust game or in its risk game counterpart. In the trust version, subjects play a standard trust game and know their counterparts are human. In the risk version, subjects know their counterparts are computers making random decisions. We compare decisions between these treatments, and also correlate behavior with subjectsâ€™ risk attitudes as measured by the Holt and Laury (2002) risk instrument. We provide evidence that trusting behavior is different than behavior under risk. In particular, (i) decisions patterns in our trust and risk games are significantly different; and (ii) risk attitudes predict decisions in the risk game, but not the trust game.
|Date of creation:||31 Dec 2006|
|Date of revision:|
|Contact details of provider:|| Postal: Munich Center for the Economics of Aging (MEA) at the Max Planck Institute for Social Law and Social Policy, Amalienstraße 33, 80799 München, Germany|
Web page: http://www.mea.mpisoc.mpg.de/
|Order Information:|| Email: |
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.:
- Charles A. Holt & Susan K. Laury, 2002. "Risk Aversion and Incentive Effects," American Economic Review, American Economic Association, vol. 92(5), pages 1644-1655, December.
- Bohnet, Iris & Zeckhauser, Richard, 2004.
"Trust, risk and betrayal,"
Journal of Economic Behavior & Organization,
Elsevier, vol. 55(4), pages 467-484, December.
- Thomas Dohmen & Armin Falk & David Huffman & Uwe Sunde, 2012.
"The Intergenerational Transmission of Risk and Trust Attitudes,"
Review of Economic Studies,
Oxford University Press, vol. 79(2), pages 645-677.
- Dohmen, Thomas & Falk, Armin & Huffman, David B. & Sunde, Uwe, 2006. "The Intergenerational Transmission of Risk and Trust Attitudes," IZA Discussion Papers 2380, Institute for the Study of Labor (IZA).
- Dohmen, Thomas J & Falk, Armin & Huffman, David & Sunde, Uwe, 2008. "The Intergenerational Transmission of Risk and Trust Attitudes," CEPR Discussion Papers 6844, C.E.P.R. Discussion Papers.
- Dohmen, Thomas J. & Falk, Armin & Huffman, David & Sunde, Uwe, 2012. "The intergenerational transmission of risk and trust attitudes," Munich Reprints in Economics 20051, University of Munich, Department of Economics.
- Thomas Dohmen & Armin Falk & David Huffman & Uwe Sunde, 2008. "The Intergenerational Transmission of Risk and Trust Attitudes," CESifo Working Paper Series 2307, CESifo Group Munich.
- McCabe, Kevin & Houser, Daniel & Ryan, Lee & Smith, Vernon & Trouard, Ted, 2001. "A Functional Imaging Study of Cooperation in Two-Person reciprocal Exchange," MPRA Paper 5172, University Library of Munich, Germany.
- Daniel Houser & Michael Keane & Kevin McCabe, 2002.
"Behavior in a dynamic decision problem: An analysis of experimental evidence using a bayesian type classification algorithm,"
- Daniel Houser & Michael Keane & Kevin McCabe, 2004. "Behavior in a Dynamic Decision Problem: An Analysis of Experimental Evidence Using a Bayesian Type Classification Algorithm," Econometrica, Econometric Society, vol. 72(3), pages 781-822, 05.
- Glaeser, Edward Ludwig & Laibson, David I. & Scheinkman, Jose A. & Soutter, Christine L., 2000.
4481497, Harvard University Department of Economics.
- 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.
- Berg Joyce & Dickhaut John & McCabe Kevin, 1995. "Trust, Reciprocity, and Social History," Games and Economic Behavior, Elsevier, vol. 10(1), pages 122-142, July.
When requesting a correction, please mention this item's handle: RePEc:mea:meawpa:06112. 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: (Henning Frankenberger)
If references are entirely missing, you can add them using this form.