Playing the trust game with other people’s money

Ola Kvaløy and Miguel Luzuriaga ()

Experimental Economics, 2014, vol. 17, issue 4, 615-630

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. Copyright Economic Science Association 2014

Date: 2014
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Working Paper: Playing the Trust Game with Other People’s Money (2012)
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DOI: 10.1007/s10683-013-9386-4

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