Notes on trust

Let’s think about trust in the context of the trust game. In the trust game, the first mover has the option to engage in a transaction with a trustee. Specifically, the first mover has the option to transfer resources to the trustee in hopes that the trustee will enhance the value of these resources and then share the surplus back with the first mover. Trust, then, is the first mover’s willingness to engage in the transaction with the trustee. We can use this conceptualization in thinking about trust generally.

We can imagine two different sources of trust:

  1. Trust predicated on the first mover’s beliefs about the trustee’s intentions or motivations—that is, trust based on beliefs about the trustee’s intrinsic motivation to avoid doing harm to the first mover.

  2. Trust predicated on the first mover’s beliefs about whether the trustee is constrained by extrinsic circumstances that affect its ability to hurt the first mover.

The behavioral implications of the two types of trust are the same insofar as each yields the same prediction about whether the first mover would engage in the transaction with the trustee. Moreover measures of “generalized trust” do not distinguish between these two per se (though in principle you could look to see whether such measures correlate more strongly with things that affect intrinsic motivations versus extrinsic circumstances).

Where the difference matters is in thinking about how levels of trust might change and why levels of trust vary.

In terms of measurement, “lab in the field” methods are typically motivated in terms of isolating the first, intrinsic, source of trust. The argument is that “in the lab,” and under conditions of anonymity, there is no scope for punishing the trustee. That being the case, such lab-in-the-field methods are not always what we want. That is, maybe sometimes we want to measure change in terms of the second, extrinsic, basis for trust. Now, we could modify the lab measure such that behavior is not anonymous. That would allow us to get at some of the extrinsic bases, although not necessarily all. My hunch is that most people would think that giving in the non-anonymous set-up would tend to be quite high (I am sure people have examined this, but I don’t have the references at my finger tips). That being the case, it follows that most people must believe that such extrinsic bases for trust are first order important.

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