Is mistrust self-fulfilling?

In this paper we study the effect on trustworthiness of the senders’ expectations in a trust game. In line with the guilt‐aversion hypothesis, we show that most receivers respond with lower returns when they face a sender with low expectations. These results suggest that reciprocity and motivations such as altruism are not sufficient to explain trustworthiness. Receivers are also driven by a desire to comply with the sender’s expectation.

Our results suggest that expecting others to be untrustworthy (if manifested) causes untrustworthy behavior, which further confirms the initially low expectations. This makes mistrust self‐fulfilling and a mistrust equilibrium particularly difficult to change.

Source: “Is mistrust self-fulfilling?” from Economics Letters 104 (2009) 89–91

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