Trust and Social Exchange

Trust is broadly construed as a willingness on the part of individuals to put their wellbeing in the hands of other persons. In survey research it is typically assessed at a societal level by asking questions about “others” in a community, while in experimental research, it most often refers to decisions made in situations involving two persons, where reciprocated trust has the potential to improve the monetary wellbeing of both participants. This dyadic trust is an exchange transaction. A decision to trust involves an evaluation of costs and benefits, including a strategic assessment of the trustworthiness of the trusted person. A decision about whether and how much to reciprocate is likely to be determined primarily by norms concerning fairness or obligation, though it can also be strategic if the transaction is to be repeated. The earliest work on trust used survey methods; a set of general questions assessed a person’s perceptions about whether others in their communities were trustworthy or fair. We begin with a brief review of research based on this set of survey questions. More recently, there has been considerable growth in behavioral research on trust, consisting of laboratory and field experiments, with most studies using a version of the “investment game” devised by Berg, Dickhaut and McCabe (1995). This research has provided an important challenge to the survey-based research, as it shows only weak relationships between survey responses and behavior in the games. We survey this work, highlighting methodological concerns. Separate sections consider the correlates of trust , trust as a relationship between two people, and the impact of specific institutional factors. Note: We appreciate the help provided by Seonghui Lee and Cathy Tipton. Useful comments were provided by Salvador Vázquez del Mercado, David Llanos, Skip Lupia and Jamie Druckman. We gratefully acknowledge support by the National Science Foundation SES0318116 and SES-0318180. That agency is not responsible for the findings reported here. Word Count: 8608 (excluding title page and abstract) 6464 (excluding references, title page and abstract) Handbook – p. 3 – Trust