Trust and Trustworthiness in a Sequential Bargaining Game

Wellesley College Working Paper No. 2002-10

32 Pages Posted: 3 Mar 2003

See all articles by Ananish Chaudhuri

Ananish Chaudhuri

University of Auckland Business School

Sarah Ali Khan

Wellesley College - Department of Economics

Aishwarya Lakshmiratan

Wellesley College - Department of Economics

Anne-Laure Py

Wellesley College - Department of Economics

Lisa Shah

The Asia Society

Date Written: December 2002

Abstract

We use a two-person extensive form bargaining game to examine individuals' trusting and reciprocal behavior and how those relate to their scores on a trust survey. In keeping with prior research, we find that the "self-interested" outcome is rejected by a majority of individuals. People who score high on the trust survey are both trusting and are also trustworthy, in that they reciprocate others' trust. But, people with low trust scores often exhibit trust but are not trustworthy. These "inconsistent trusters" seem to be interested in exploiting the trust and trustworthiness of others in increasing their own payoff.

Keywords: Trust, Reciprocity, Social Values Orientation, Sequential Game, Bargaining

JEL Classification: C72, C91

Suggested Citation

Chaudhuri, Ananish and Ali Khan, Sarah and Lakshmiratan, Aishwarya and Py, Anne-Laure and Shah, Lisa, Trust and Trustworthiness in a Sequential Bargaining Game (December 2002). Wellesley College Working Paper No. 2002-10, Available at SSRN: https://ssrn.com/abstract=370061 or http://dx.doi.org/10.2139/ssrn.370061

Ananish Chaudhuri (Contact Author)

University of Auckland Business School ( email )

12 Grafton Rd
Private Bag 92019
Auckland, 1010
New Zealand

Sarah Ali Khan

Wellesley College - Department of Economics ( email )

106 Central Street
Wellesley, MA 02181
United States

Aishwarya Lakshmiratan

Wellesley College - Department of Economics ( email )

106 Central Street
Wellesley, MA 02181
United States

Anne-Laure Py

Wellesley College - Department of Economics ( email )

106 Central Street
Wellesley, MA 02181
United States

Lisa Shah

The Asia Society ( email )

New York, NY 10021-5088
United States

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