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Deterministic versus probabilistic consequences of trust and trustworthiness: An experimental investigation
Affiliation:1. Department of Economics and the CERPA (Center for Economic Research and Policy Analysis), Appalachian State University, Boone, NC, USA;2. IZA (Institute for the Study of Labor), Bonn, Germany;3. ESI (Economic Science Institute), Chapman University, Orange, CA, USA;4. Department of Psychology, Florida Gulf Coast University, Ft. Myers, FL, USA
Abstract:
There is overwhelming evidence of reciprocal behavior, driven by intentions. However, the role of consequences is less clear cut. Experimentally manipulating how efficient trust and reciprocity can be in deterministic and uncertain environments allows us to study how payoff consequences of trust and trustworthiness affect reciprocity. According to the results for our modified Investment Game, trustees reward trust more when trust is more efficient but do not adjust rewards when the efficiency of rewarding is varied. Furthermore, higher deterministic benefits result in higher levels of reciprocity for all trust levels, whereas an uncertain environment diminishes reciprocity.
Keywords:Trust and reciprocity  Consequences  Other-regarding preferences  Uncertainty  Experiment
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