Trust, Values and False Consensus
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. Miscalibrated beliefs lower participants' experimental trust game earnings by about 20 percent on average.
|Date of creation:||Oct 2012|
|Publication status:||published as TRUST, VALUES, AND FALSE CONSENSUS Jeffrey V. Butler1, Paola Giuliano2 andLuigi Guiso3,† Article first published online: 30 JUL 2015 DOI: 10.1111/iere.12125 International Economic Review Volume 56, Issue 3, pages 889–915, August 2015|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
Web page: http://www.nber.org
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