Trust and Trustworthiness in the Aftermath of Natural Disasters: Experimental Evidence from the 2010 Chilean Earthquake

Alberto Chong, David Fleming and Hernan Bejarano

Working Papers from The George Washington University, Institute for International Economic Policy

Abstract: Peoples' behavior in the aftermath of natural disasters may depend critically on various conditions. In this paper we postulate three conditions, likely to occur after massive natural disasters, that can adversely affect the trusting behavior of people within communities: rivalry for scarce relief and recovery recourses, increment of information asymmetries between agents (what we call aftermath moral hazard) that provides excuses to break pre-established-social contracts, and migration or social displacement of people. To investigate this issue a series of trust games were conducted in Chile to analyze whether the 2010 earthquake affected the trust and trustworthiness of villagers in rural areas. Experiments were conducted one year after the occurrence of the earthquake in a group of villages that were heavily affected by this disaster and in a group of villages that were not affected (villages that act as control group). Game outcomes and additional socioeconomic data collected with surveys are compared and analyzed by statistical tests and regressions. We find that trust levels (and most socioeconomic characteristics of participants) are not statistically different between groups. However, we find that trustworthiness levels of affected villages are lower than levels observed in control villages, supporting our argument that aftermath conditions can negatively affect trusting behavior. Results are important in assessing vulnerability and resilience to natural disasters, and therefore relevant for policy regarding aid and recovery of communities affected by these types of events.

Keywords: Targeting; Scarcity; Trust; Game theory; Vulnerability; Resilience; Aid (search for similar items in EconPapers)
JEL-codes: H42 I38 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2011-10
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:gwi:wpaper:2011-15

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