Quotation Kartal, Melis. 2021. Building trust: The costs and benefits of gradualism. Games and Economic Behavior. 130 258-275.


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Abstract

We examine the prevalence of gradualist strategies and their effect on trust-building and economic gains in a setting with an infinite horizon, asymmetric information regarding the trustworthiness of receivers, and various levels of trust. The theoretical literature suggests that gradualist strategies mitigate asymmetric information problems and foster trust-building. However, we theoretically and experimentally show that gradualism sometimes reduces joint payoffs relative to a simple “binary” setting in which trust is an all-or-nothing decision. In a series of experiments, we vary the degree of asymmetric information as well as the economic returns to trusting behavior, and delineate circumstances under which gradualism may promote or curb efficiency.

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Publication's profile

Status of publication Published
Affiliation WU
Type of publication Journal article
Journal Games and Economic Behavior
Citation Index SSCI
WU Journalrating 2009 A
WU-Journal-Rating new FIN-A, VW-A, WH-B
Language English
Title Building trust: The costs and benefits of gradualism
Volume 130
Year 2021
Page from 258
Page to 275
Reviewed? Y
URL https://www.sciencedirect.com/science/article/pii/S0899825621000956
DOI https://doi.org/10.1016/j.geb.2021.07.008
Open Access Y
Open Access Link https://www.sciencedirect.com/science/article/pii/S0899825621000956

Associations

People
Kartal, Melis (Details)
Organization
Department of Economics (Kartal) (Details)
Research areas (ÖSTAT Classification 'Statistik Austria')
5325 Political economics (Details)
5351 Public economy (Details)
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