If a lack of trust causes investors to discount the information in accounting numbers, then the stock price will tend … to under-react to earnings surprises. Using survey measures of interpersonal trust across regions of the United States …, we find greater stock price reactions to earnings surprises for firms located in high trust regions. Their counterparts …

Experimental evidence reveals that there is a strong willingness to trust and to act in both positively and negatively … buyers, as well as needing to trust others and reciprocate with their network. We base our analysis on the German Socio …-Economic Panel and recently introduced questions about trust, positive reciprocity, and negative reciprocity to examine the extent …