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Trust Game


Overview: The initial decision maker in a "trust game" decides how much money to pass to the other person. All money passed is increased by a factor, M >= 1, and the second mover then decides how much of this to return to the first mover and how much to keep, increased by a factor, N >= 1 too . 


Theoretical Background:  The Nash equilibrium for selfish preferences is to pass nothing, since a self-interested person would return nothing in the final stage. The game highlights issues of reciprocity and strategy, and the extent to which observed behavior is "rational" from a selfish, strategic perspective. Berg (1995). Many Literature ...,  like ... 


Motive: We study how the social trust response on the institutions, by conducted a  parameter set.


Data: During Oct., to Dec. 2008, near 30 sessions  of standard Trust Game was conducted in Zhejiang Gongshang University & Zhejiang University, China. 


Result:   











Recently, one of the authors found herself standing in line in a supermarket, with a basket full of groceries but no wallet. She decided to ask the person behind her whether he could lend her $20. He did and gave her his business card so that she could return the money. No questions asked.



Information from ESA Group, June 21,  http://groups.google.com/group/esa-discuss/

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Karl Schlag  
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 More options Jun 19, 9:11 pm
There are so many papers out there on the trust game but I have only 
found few that investigate whether trust (as measured by the amount 
sent) is correlated with trustworthiness (as measured by the return 
ratio = amount returned divided by amount received). Any references? Any 
data where I can check this myself? 

Meidinger et al (1999) and Bornhorst et al (2008) report a significantly 
positive correlation 

I have the data for Croson and Buchan (1999) where there is a slight 
effect, depending on the statistical method. 

Berg et al. (1995), Willinger et al (2003) and Csukas et al. (2008) 
report lack of significant positive correlation. 

thanx in advance, karl 

References: 
Berg, J., J. Dickhaut and K. McCabe, (1995) “Trust, Reciprocity and 
Social History”, Games and Economic Behaviour, 10:122-142. 
Bornhorst, Ichino, Kirchkamp, Schlag and Winter (2008, soon available in 
completely rewritten version with new title), Trust and Trustworthiness 
among Europeans: South - North Comparison, 
http://www.econ.upf.edu/~schlag/PDF/ET/northsouth.pdf
Csukás, Paulo Fracalanza, Tamás Kovács, Marc Willinger (2008), "The 
Determinants of Trusting and Reciprocal Evidence from an Intercultural 
Experiment", Journal of Economic Development 33(1), 71-95. 
Meidinger, C., Robin, S., & Ruffieux, B. (1999). Confiance, reciprocite 
et cheap talk. Revue Economique, 1, 5--44. 
M. Willinger, C. Keser, C. Lohmann, J.-C. Usunier (2003), "A comparison 
of trust and reciprocity between France and Germany: Experimental 
Investigation based on the Investment Game", Journal of Economic 
Psychology 24 (2003) 447--466. 

-- 
--------------------------------------------------------------------- 
Karl Schlag   
Professor                               Tel:  +34 93 542 1493 
Dept. of Economics and Business         Fax:  +34 93 542 1746 
Universitat Pompeu Fabra                email: karl.sch...@upf.edu 
Ramon Trias Fargas 25-27                NEW: www.econ.upf.edu/~schlag/ 
Barcelona 08005, Spain                  room: 20-221 Jaume I 


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Putterman, Louis  
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 More options Jun 20, 12:01 am
In Ben-Ner and Putterman, "Trust, Communication and Contracts," just published in JEBO, we report a statistically significant positive relationship between the amount sent by the 1st mover and the *proportion* of the received amount returned by the 2nd mover in Tables 4 and 6.  Ben-Ner, Putterman and Ren find a marginally significant positive relationship of the same kind in "Lavish Returns on Cheap Talk," not yet published but available as a Brown working paper.  Also, in an unpublished paper by Atlas and Putterman, "Trust Among the Avatars," (a trust game played in Second Life), we report an insignificant positive association between 1st mover sending and 2nd mover *proportion* returned and a significant positive relationship between 1st mover sending and 2nd mover absolute amount returned.  I'll send you the two unpublished papers off line, Karl. 

Louis Putterman 

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Angela A Stanton  
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 More options Jun 20, 1:26 am
Hi Karl, 

My dissertation's 3rd chapter discusses the trust game and the influence of 
the amount of money sent by DM1 in how much is returned by DM2. Although the 
experiment was using the neuropeptide Arginine vasopressin (expectation is of 
opposite effect from oxytocin), it might still be useful for you. 

Here is the link to the volume of the journal and mine is the first article 
up: http://www.scientificjournals.org/journals2007/j_of_dissertation.htm 

Cheers, 
Angela 

___________ 

Angela A. Stanton, Ph.D. 
http://www.angelastanton.com/ 
Research Fellow 
Max Planck Institute of Economics, Jena, Germany 
http://www.econ.mpg.de/english/research 
stan...@econ.mpg.de 
Visiting Scholar 
Center for Neuroeconomics Studies, Claremont, CA, USA 
http://www.neuroeconomicstudies.org/    

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Chaudhuri, Ananish  
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 More options Jun 20, 7:04 am
Hi Karl: 

You can look at the following paper: 

Chaudhuri Ananish and Lata Gangadharan, "An Experimental Analysis of Trust and Trustworthiness”, Southern Economic Journal, April 2007, 73(4), 959-985. 

We regress the proportion send back by the receiver against the amount received by the receiver (along with other controls) and find a significant coefficient for the amount received. 

We explore a number of other issues in this context. For instance, we show that those who trust are not necessarily trustworthy, in the sense that there are two clear types. One type which is both trusting and trustworthy, while another type trusts but does not reciprocate trust. 

We also explore correlations between behaviour in the trust game with those in the dictator game using a within subjects design. 

You can have the data for the paper if you wish. 

Cheers. 

Ananish 

________________________________________ 
From: esa-discuss@googlegroups.com [esa-discuss@googlegroups.com] On Behalf Of Karl Schlag [karl.sch...@upf.edu] 
Sent: Saturday, June 20, 2009 1:11 AM 
To: ESA Experimental Methods Discussion 
Subject: [ESA-discuss] when are trust and trustworthiness correlated? 

There are so many papers out there on the trust game but I have only 
found few that investigate whether trust (as measured by the amount 
sent) is correlated with trustworthiness (as measured by the return 
ratio = amount returned divided by amount received). Any references? Any 
data where I can check this myself? 

Meidinger et al (1999) and Bornhorst et al (2008) report a significantly 
positive correlation 

I have the data for Croson and Buchan (1999) where there is a slight 
effect, depending on the statistical method. 

Berg et al. (1995), Willinger et al (2003) and Csukas et al. (2008) 
report lack of significant positive correlation. 

thanx in advance, karl 

References: 
Berg, J., J. Dickhaut and K. McCabe, (1995) “Trust, Reciprocity and 
Social History”, Games and Economic Behaviour, 10:122-142. 
Bornhorst, Ichino, Kirchkamp, Schlag and Winter (2008, soon available in 
completely rewritten version with new title), Trust and Trustworthiness 
among Europeans: South - North Comparison, 
http://www.econ.upf.edu/~schlag/PDF/ET/northsouth.pdf
Csukás, Paulo Fracalanza, Tamás Kovács, Marc Willinger (2008), "The 
Determinants of Trusting and Reciprocal Evidence from an Intercultural 
Experiment", Journal of Economic Development 33(1), 71-95. 
Meidinger, C., Robin, S., & Ruffieux, B. (1999). Confiance, reciprocite 
et cheap talk. Revue Economique, 1, 5--44. 
M. Willinger, C. Keser, C. Lohmann, J.-C. Usunier (2003), "A comparison 
of trust and reciprocity between France and Germany: Experimental 
Investigation based on the Investment Game", Journal of Economic 
Psychology 24 (2003) 447--466. 

-- 
--------------------------------------------------------------------- 
Karl Schlag 
Professor                               Tel:  +34 93 542 1493 
Dept. of Economics and Business         Fax:  +34 93 542 1746 
Universitat Pompeu Fabra                email: karl.sch...@upf.edu 
Ramon Trias Fargas 25-27                NEW: www.econ.upf.edu/~schlag/ 
Barcelona 08005, Spain                  room: 20-221 Jaume I 


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Stephen V. Burks  
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 More options Jun 21, 3:07 am
Hi, Karl. 

In "Playing Both Roles in the Trust Game," (2003 JEBO) in a series of 
regressions, each of which adds further controls (demographics, the Mach 
scale, some survey questions), we found that the $ amount received was a 
pretty robust predictor of fraction returned by the responder, although 
the size of the effect was modest (see Table 6; the predicted difference 
in fraction returned between receiving $0 and receiving $30 was .18). 
The descriptive comparison is in Figure 2. 

I can't be sure from your question, but you might also be interested in 
the main point of this paper. We compared the standard Berg, Dickhaut, & 
McCabe version to a design in which each participant plays both sender 
and responder roles, with nested treatments in which the fact of both 
roles is revealed in the first treatment after sending, and in the 
second treatment before sending. We found that playing both roles 
sharply cut both the amount sent and the fraction returned. 

Best, 
Steve 

Ref: Burks, Carpenter, and Verhoogen, “Playing Both Roles in the Trust 
Game”, Journal of Economic Behavior and Organization, Vol. 51, No. 2 
(June 2003), pp. 195-216. 

- Show quoted text -

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*Stephen V. Burks, Ph.D. 
*Associate Professor of Economics and Management 
*University of Minnesota, Morris 

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* Trucking Industry Program, Georgia Tech 
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