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Trust and Performance: Exploring Socio-Economic Mechanisms in the “Deep” Network Structure with Agent-Based Modeling

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  • Gao, Lin

Abstract

This paper extends the concept of interaction platforms and explores the evolution of interaction and cooperation supported by individuals’ changing trust and trustworthiness on directed weighted regular ring network from the angle of micro scope by using agent-based modeling. This agent-based model integrates several considerations below via a relatively delicate experimental design: 1) a characteristic of trust is that trust is destroyed easily and built harder (Slovic, 1993); 2) trustworthiness may be reflected on both strategy decision and payoff structure decision; 3) individuals can decide whether or not to be involved in an interaction; 4) interaction density exists, not only between neighbors and strangers (Macy and Skvoretz, 1998), but also within neighbors; 5) information diffusion. In this agent-based model, marginal rate of exploitation of original payoff matrix and relative exploitation degree between two payoff matrices are stressed in their influence of trust-destroying; influence of observing is introduced via imagined strategy; relationship is maintained through relationship maintenance strength, and so on. This paper treats number of immediate neighbors, degree of embeddedness in social network, mutation probability of payoff matrix, mutated payoff matrix, proportion of high trust agents and probabilities of information diffusion within neighborhood and among non-neighbors as important aspects happening on interaction platforms, and the influences of these factors are probed respectively on the base of a base-line simulation.

Suggested Citation

  • Gao, Lin, 2016. "Trust and Performance: Exploring Socio-Economic Mechanisms in the “Deep” Network Structure with Agent-Based Modeling," MPRA Paper 75214, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:75214
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    References listed on IDEAS

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    Cited by:

    1. Andrea Venturelli & Fabio Caputo & Simone Pizzi, 2018. "L’impatto del contratto di rete nei processi di internazionalizzazione: alcune evidenze empiriche sulle PMI italiane," MANAGEMENT CONTROL, FrancoAngeli Editore, vol. 2018(2), pages 61-83.

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    More about this item

    Keywords

    Trust; trustworthiness; directed weighted regular ring network; agent-based modeling; marginal rate of exploitation; relative exploitation degree; imagined strategy; relationship maintenance strength; number of neighbors; degree of embeddedness in social network; mutation of payoff matrix; information diffusion; social mobility; institutional quality; evolution of interaction; evolution of cooperation;
    All these keywords.

    JEL classification:

    • B52 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Historical; Institutional; Evolutionary; Modern Monetary Theory;
    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation

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