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Competition vs. communication: An experimental study on restoring trust

Vivian Lei, David Masclet () and Filip Vesely
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Vivian Lei: Department of Economics - University of Wisconsin-Milwaukee

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Abstract: Trust is fragile. It is hard to build but easy to destroy. In this paper, we explore the fragility of trust in a stylized laboratory environment. We ask whether transgression outside a direct send-and-return relationship destroys trust and, if so, whether a competition against outsiders or an apology for misdeeds helps restore it. We find that transgression significantly reduces trust and that the broken trust can be greatly restored by group competition. Communication via an apology, impersonal or not, has an insignificant impact. By contrast, offering explanations for misbehavior is as effective as group competition.

Keywords: Experiments; trust restoration; group competition; communication (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-exp and nep-soc
Date: 2014-12
Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-01074083
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Published in Journal of Economic Behavior and Organization, Elsevier, 2014, 108, pp.94-107. 〈10.1016/j.jebo.2014.09.001〉

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-01074083

DOI: 10.1016/j.jebo.2014.09.001

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