Trust and trustworthiness in corrupted economic environments

DOI10.3390/G12010016MaRDI QIDQ2052497zbMATH OpenOpenAlexFDO

Authors Leonardo Becchetti, Luca Corazzini, Vittorio Pelligra

Publication date 26 November 2021

Published in Games (Search for Journal in Brave)

Full work available at URL https://doi.org/10.3390/g12010016

zbMATH Keywords

corruptionextended trust gamelaboratory experiment

Mathematics Subject Classification ID

(n)-person games, (n>2) (91A06) Experimental studies (91A90)

Review text

Summary: We use an original variant of the standard trust game to study the effects of corruption on trust and trustworthiness. In this game, both the trustor and the trustee know that part of the surplus they can generate may be captured by a third ``corrupted player under different expected costs of audit and prosecution. We find a slightly higher trustor's giving in the presence of corruption, matched by a significant excess of reciprocity from the trustee. Both the trustor and the trustee expect, on average, corruption to act as a tax, inelastic to changes in the probability of corruption prosecution. Expectations are correct for the inelasticity assumption and for the actual value of the ``corruption tax. Our experimental findings lead to the rejection of four standard hypotheses based on purely self-regarding preferences. We discuss how the apparently paradoxical excess reciprocity effect is consistent with the cultural role of heroes in history, where examples of commendable giving have been used to stimulate emulation of ordinary people. Our results suggest that the excess reciprocity component of the trustee makes the trustor's excess giving a rational and effective strategy.

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Cites work

• Cowards and Heroes: Group Loyalty in the American Civil War
• Does Local Financial Development Matter?
• Promises and Partnership
• The framing of games and the psychology of play
• The self-fulfilling property of trust: an experimental study
• Trust, reciprocity, and social history

Cited in

(11)

• Rewarding trust: An experimental study
• The role of framing, inequity and history in a corruption game: some experimental evidence
• Breaking the rules: anticipation of norm violation in a binary-choice trust game
• Endogenous institutional selection, building trust, and economic growth
• Accountability as a warrant for trust: an experiment on sanctions and justifications in a trust game
• The COVID-19 pandemic reduces trust behavior
• Do lies erode trust?
• A game theoretical study of generalized trust and reciprocation in Poland. I: Theory and experimental design
• Trust and Household Debt
• Honesty in the city
• Subject pool effects in a corruption experiment: A comparison of Indonesian public servants and Indonesian students

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