In a world of imperfect information, reputations often guide the sequential decisions to trust and to reward trust. We consider two-player situations, where one player - the truster - decides whether to trust, and the other player - the temptee - has a temptation to betray when trusted. The...

Due to betrayal aversion, people take risks less willingly when the agent of uncertainty is another person rather than nature. Individuals in four countries (Brazil, Switzerland, the United Arab Emirates and the United States) confronted either a binary-choice trust game or a risky decision...

Using experiments, we examine whether the decision to trust a stranger in a one-shot interaction is equivalent to taking a risky bet, or if a trust decision entails an additional risk premium to balance the costs of trust betrayal. We compare a binary-choice Trust game with a structurally...

Using experiments, we examine whether the decision to trust a stranger in a one-shot interaction is equivalent to taking a risky bet, or if a trust decision entails an additional risk premium to balance the costs of trust betrayal. We compare a binary-choice Trust game with a structurally...

In a world of imperfect information, reputations often guide the sequential decisions to trust and to reward trust. We consider two-player situations where the players meet but once. One player - the truster - decides whether to trust, and the other player - the temptee - has a temptation to...

Why is private investment so low in Gulf compared to Western countries? We investigate cross-regional differences in trust and reference points for trustworthiness as possible factors. Experiments controlling for cross-regional differences in institutions and beliefs about trustworthiness reveal...