Abstract

When playing one-shot economic games, individuals often blindly trust others, accepting partnerships without any information regarding the trustworthiness of their partner. Consequently, they risk deleterious pacts. Oddly, when individuals do have information about another, they reject partnerships that are not fair, despite the fact that such offers are profitable — individuals costly punish. Why would one reject profitable partnerships on the one hand, but risk unknown offers on the other? Significant research has gone into explaining the contexts where blind trust or costly punishment provide an evolutionary advantage; however, both behaviours are rarely considered in tandem. Here we demonstrate that both behaviours can simultaneously be revenue maximizing. Further, given the plausible condition of partially obscured information and partner choice, trust mediates the generation of costly punishment. This result is important because it demonstrates that the evolutionary viability of trust, fairness, and costly punishment may be linked. The adaptive nature of fairness expectations can best be explained in concert with trust.
LanguageEnglish
Number of pages33
JournalDynamic Games and Applications
Early online date25 Sep 2017
DOIs
StatusE-pub ahead of print - 25 Sep 2017

Fingerprint

Partial Information
Fairness
Economics
Trustworthiness
Viability
Demonstrate
Game
Unknown
Partnership

Keywords

  • trust, partial information, costly punishment, fairness, trust 23 game, negative pseudo-reciprocity

Cite this

Expectations of Fairness and Trust Coevolve Because of Partial Information. / Bryson, Joanna J; Rauwolf, Paul.

In: Dynamic Games and Applications, 25.09.2017.

Research output: Contribution to journalArticle

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