Playing the trust game with other people’s money

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Creators: Kvaloy, Ola and Luzuriaga, Miguel
Title: Playing the trust game with other people’s money
Item Type: Article or issue of a publication series
Projects: ILR
Journal or Series Title: Experimental Economics
Page Range: pp. 615-630
Date: December 2014
Divisions: Wirtschaftswissenschaften
Abstract: We experimentally investigate to what extent people trust and honor trust when they are playing with other people’s money (OPM). We adopt the well-known trust game by Berg et al. (in Games Econ. Behav. 10:122–142, 1995), with the difference that the trustor (sender) who sends money to the trustee (receiver) does this on behalf of a third party. We find that senders who make decisions on behalf of others do not behave significantly different from senders in our baseline trust game who manage their own money. But receivers return significantly less money when senders send a third party’s money. As a result, trust is only profitable in the baseline trust game, but not in the OPM treatment. The treatment effect among the receivers is gender specific. Women return significantly less money in OPM than in baseline, while there is no such treatment effect among men. Moreover, women return significantly less than men in the OPM treatment.

Kvaloy, Ola and Luzuriaga, Miguel (2014) Playing the trust game with other people’s money. Experimental Economics, 17 (4). pp. 615-630.

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