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Can centralized sanctioning promote trust in social dilemmas? A two-level trust game with incomplete information.

Wang RY, Ng CN - PLoS ONE (2015)

Bottom Line: Previous literature has paid much academic attention on effects of peer punishment and altruistic third-party punishment on trust and human cooperation in dyadic interactions.However, the effects of centralized sanctioning institutions on decentralized reciprocity in hierarchical interactions remain to be further explored.Moreover, they have shown that even a slight uncertainty about the type of the newly introduced authority might facilitate the establishment of trust and reciprocity in social dilemmas.

View Article: PubMed Central - PubMed

Affiliation: Faculty of Social Sciences, The University of Hong Kong, Pokfulam, Hong Kong, Hong Kong.

ABSTRACT
The problem of trust is a paradigmatic social dilemma. Previous literature has paid much academic attention on effects of peer punishment and altruistic third-party punishment on trust and human cooperation in dyadic interactions. However, the effects of centralized sanctioning institutions on decentralized reciprocity in hierarchical interactions remain to be further explored. This paper presents a formal two-level trust game with incomplete information which adds an authority as a strategic purposive actor into the traditional trust game. This model allows scholars to examine the problem of trust in more complex game theoretic configurations. The analysis demonstrates how the centralized institutions might change the dynamics of reciprocity between the trustor and the trustee. Findings suggest that the sequential equilibria of the newly proposed two-level model simultaneously include the risk of placing trust for the trustor and the temptation of short-term defection for the trustee. Moreover, they have shown that even a slight uncertainty about the type of the newly introduced authority might facilitate the establishment of trust and reciprocity in social dilemmas.

No MeSH data available.


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Extensive form of a baseline trust game with incomplete information.
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pone.0124513.g002: Extensive form of a baseline trust game with incomplete information.

Mentions: The formal game theoretic analysis begins with a review of a baseline model which is built upon the trust game presented in Fig 1 [7,10,50,51]. The baseline model includes two important features. The first one is a move by nature, before the game starts, deciding which type of trustee will participate in the game (see Fig 2). This entails that it is assumed two types of trustees exist in nature—the G-type (good) and the B-type (bad). Both types of trustees are utility maximisers. Yet they have different preferences. The G-type trustees have stronger altruistic tendencies and therefore always feel more satisfied by honouring trust than abusing trust. On the contrary, the B-type trustees have stronger selfish tendencies and therefore prefer abusing trust than honouring trust in a one-shot game. This is a plausible assumption as it reflects the coexistence of opportunists and altruists in empirical settings [52–54]. The trustee knows his type, yet information is incomplete in the sense that, at the beginning of the game, the trustor does not know which type of trustee will be his counterpart. Let π1E be the probability that the trustor assigns at the beginning of the game to the event that the trustee is a G-type.


Can centralized sanctioning promote trust in social dilemmas? A two-level trust game with incomplete information.

Wang RY, Ng CN - PLoS ONE (2015)

Extensive form of a baseline trust game with incomplete information.
© Copyright Policy
Related In: Results  -  Collection

License
Show All Figures
getmorefigures.php?uid=PMC4400067&req=5

pone.0124513.g002: Extensive form of a baseline trust game with incomplete information.
Mentions: The formal game theoretic analysis begins with a review of a baseline model which is built upon the trust game presented in Fig 1 [7,10,50,51]. The baseline model includes two important features. The first one is a move by nature, before the game starts, deciding which type of trustee will participate in the game (see Fig 2). This entails that it is assumed two types of trustees exist in nature—the G-type (good) and the B-type (bad). Both types of trustees are utility maximisers. Yet they have different preferences. The G-type trustees have stronger altruistic tendencies and therefore always feel more satisfied by honouring trust than abusing trust. On the contrary, the B-type trustees have stronger selfish tendencies and therefore prefer abusing trust than honouring trust in a one-shot game. This is a plausible assumption as it reflects the coexistence of opportunists and altruists in empirical settings [52–54]. The trustee knows his type, yet information is incomplete in the sense that, at the beginning of the game, the trustor does not know which type of trustee will be his counterpart. Let π1E be the probability that the trustor assigns at the beginning of the game to the event that the trustee is a G-type.

Bottom Line: Previous literature has paid much academic attention on effects of peer punishment and altruistic third-party punishment on trust and human cooperation in dyadic interactions.However, the effects of centralized sanctioning institutions on decentralized reciprocity in hierarchical interactions remain to be further explored.Moreover, they have shown that even a slight uncertainty about the type of the newly introduced authority might facilitate the establishment of trust and reciprocity in social dilemmas.

View Article: PubMed Central - PubMed

Affiliation: Faculty of Social Sciences, The University of Hong Kong, Pokfulam, Hong Kong, Hong Kong.

ABSTRACT
The problem of trust is a paradigmatic social dilemma. Previous literature has paid much academic attention on effects of peer punishment and altruistic third-party punishment on trust and human cooperation in dyadic interactions. However, the effects of centralized sanctioning institutions on decentralized reciprocity in hierarchical interactions remain to be further explored. This paper presents a formal two-level trust game with incomplete information which adds an authority as a strategic purposive actor into the traditional trust game. This model allows scholars to examine the problem of trust in more complex game theoretic configurations. The analysis demonstrates how the centralized institutions might change the dynamics of reciprocity between the trustor and the trustee. Findings suggest that the sequential equilibria of the newly proposed two-level model simultaneously include the risk of placing trust for the trustor and the temptation of short-term defection for the trustee. Moreover, they have shown that even a slight uncertainty about the type of the newly introduced authority might facilitate the establishment of trust and reciprocity in social dilemmas.

No MeSH data available.


Related in: MedlinePlus