Trust among Internet Traders

Bolton, Gary E.; Katok, Elena; Ockenfels, Axel

doi:10.1515/auk-2004-0110

Cited by 42 publications

(10 citation statements)

References 6 publications

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“… The overall rate of trustees who chose return in the TG is 40% (and 40% in the control condition only). This is in line with what Snijders and Keren [39] find with Dutch students (44%) and what Bolton and colleagues [40] find with German students (37%), but lower than what McCabe and colleagues [37] find with US students (65%). However, McCabe and colleagues [37] give trustees a comparatively high monetary incentive to choose return and their rate is similar to what Snijders and Keren [39] find with a comparable payoff structure (63–75%).…”

Section: Resultssupporting

confidence: 90%

Natural and Strategic Generosity as Signals of Trustworthiness

Gambetta

Przepiorka

2014

PLoS ONE

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We exploit the fact that generosity and trustworthiness are highly correlated and the former can thus be a sign of the latter. Subjects decide between a generous and a mean split in a dictator game. Some of them are informed from the start that afterwards they will participate in a trust game and that their choice in the dictator game may matter; others are not informed in advance. In the trust game, before trusters decide whether or not to trust, some trustees can reveal (or conceal) only their true choice in the dictator game, while others can say to trusters, truthfully or otherwise, what they chose. We find that a generous choice made naturally by uninformed trustees and reliably revealed is more effective in persuading trusters to trust than a generous choice that could be strategic or a lie. Moreover, we find that, when they can, mean subjects lie and go on to be untrustworthy.

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Section: Resultssupporting

confidence: 90%

Natural and Strategic Generosity as Signals of Trustworthiness

Gambetta

Przepiorka

2014

PLoS ONE

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“…Perhaps the best-known example of an institutional mechanism to promote cooperation is the wide-spread use of reputation systems or "rating systems" 7 , allowing users to publicly "rate" their experience with their exchange partners through some type of fixed and often quantified format (e.g., the ubiquitous "five stars") or through a free-form qualitative format (e.g., written reviews). Conceptually, reputation systems promote trust and cooperation in much the same way social embeddedness does: by allowing actors to monitor each other's past behavior, potential defectors are incentivized to cooperate or deterred from entering the market (Bolton et al 2004b;Przepiorka 2013;Resnick and Zeckhauser 2002;Tadelis 2016). Meanwhile there is ample empirical evidence from lab experiments (Bolton et al 2004b(Bolton et al , 2004a, field experiments (Resnick and Zeckhauser 2006) and observational studies on online markets (Diekmann et al 2014;Kollock 1999b;Przepiorka et al 2017;Resnick and Zeckhauser 2002) that such reputation systems indeed tend to promote trust, and as such these systems are widely considered to be the key innovation that makes trust in online interactions (including sharing economy interactions) feasible (e.g., Botsman and Rogers 2010).…”

Section: Solutions For Two-person Dilemmasmentioning

confidence: 99%

Social dilemmas in the sharing economy

Corten¹

2019

Preprint

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While it is widely acknowledged that trust plays an important role in the sharing economy, it is often confused with other strategic considerations related to cooperation in sharing economy interactions. In this chapter I propose that social dilemma research, rooted in game theory, offers a rich and flexible theoretical framework for studying sharing economy interactions. I sketch applicable models that may involve trust as an important feature of many sharing economy interactions but also highlight other strategic considerations that superficially look similar to trust problems but may be understood more fruitfully by alternative models. More specifically, I discuss various types of two-person dilemmas such as the Prisoner's Dilemma and the Trust Game, but also N-person dilemmas, including common pool problems, exchange systems, and club goods. Solutions to the cooperation problems implied by these dilemmas are also discussed. I conclude the chapter by sketching some promising directions for future research.

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“…In indirect reciprocity situations (24)(25)(26), individuals who have helped others are given support (here, money), that is, the supporters improve their reputation and are rewarded in turn: ''give and you shall receive'' (27)(28)(29)(30). Because players would risk their reputation if they did not cooperate in a public goods game, that was alternated with the indirect reciprocity game; alternating rounds of these two games may induce cooperation in the public goods game (21)(22)(23).…”

mentioning

confidence: 99%

Stabilizing the Earth’s climate is not a losing game: Supporting evidence from public goods experiments

Milinski

Semmann

Krambeck

et al. 2006

Proc. Natl. Acad. Sci. U.S.A.

341

252

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Maintaining the Earth's climate within habitable boundaries is probably the greatest ''public goods game'' played by humans. However, with >6 billion ''players'' taking part, the game seems to rule out individual altruistic behavior. Thus, climate protection is a problem of sustaining a public resource that everybody is free to overuse, a ''tragedy of the commons'' problem that emerges in many social dilemmas. We perform a previously undescribed type of public goods experiment with human subjects contributing to a public pool. In contrast to the standard protocol, here the common pool is not divided among the participants; instead, it is promised that the pool will be invested to encourage people to reduce their fossil fuel use. Our extensive experiments demonstrate that players can behave altruistically to maintain the Earth's climate given the right set of circumstances. We find a nonzero basic level of altruistic behavior, which is enhanced if the players are provided with expert information describing the state of knowledge in climate research. Furthermore, personal investments in climate protection increase substantially if players can invest publicly, thus gaining social reputation. This increase occurs because subjects reward other subjects' contributions to sustaining the climate, thus reinforcing their altruism. Therefore, altruism may convert to net personal benefit and to relaxing the dilemma if the gain in reputation is large enough. Our finding that people reward contributions to sustaining the climate of others is a surprising result. There are obvious ways these unexpected findings can be applied on a large scale.climate change ͉ public goods game ͉ reputation ͉ tragedy of the commons

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Trust among Internet Traders

Cited by 42 publications

References 6 publications

Natural and Strategic Generosity as Signals of Trustworthiness

Natural and Strategic Generosity as Signals of Trustworthiness

Social dilemmas in the sharing economy

Stabilizing the Earth’s climate is not a losing game: Supporting evidence from public goods experiments

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