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Impacts of Urbanisation on Trust: Evidence from an Experiment in the Field

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  • Elvis Cheng Xu

    (Nottingham University Business School China)

Abstract

We conduct a field trust game under a natural experiment context to test the impacts of urbanisation on trust. We conjecture that urbanisation, defined in this context as the process of state-led rural-urban migration, contributes to a transformation of trust levels among co-villagers and towards outsiders. We test this conjecture in an experimental approach and more generally, examine whether the urbanisation will produce significant impacts on in-group trust and out-group trust. The research finds that urbanisation does not decrease significantly the trust towards co-villagers, meaning the in-group trust did not change statistically significantly. However, the trust towards outsiders does increase as a result of the state-led urbanisation. We also run a regression on the trust exhibited towards participants in the experiment and found the partial effect of whether they are co-villagers or outsiders weakens as a result of the urbanisation, and therefore conclude urbanisation decreases out-group discrimination in trust.

Suggested Citation

  • Elvis Cheng Xu, 2019. "Impacts of Urbanisation on Trust: Evidence from an Experiment in the Field," Discussion Papers 2019-10, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
    • Handle: RePEc:not:notcdx:2019-10
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    Keywords

    Urbanisation; Trust; Field Experiment;
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