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Learning to trust strangers: an evolutionary perspective

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  • Pierre Courtois
  • Tarik Tazdaït

Abstract

What if living in a relatively trustworthy society was sufficient to blindly trust strangers? In this paper we interpret generalized trust as a learning process and analyse the trust game paradox in light of the replicator dynamics. Given that trust inevitably implies doubts about others, we assume incomplete information and study the dynamics of trust in buyer-supplier purchase transactions. Considering a world made of “good” and “bad” suppliers, we show that the trust game admits a unique evolutionarily stable strategy: buyers may trust strangers if, on the whole, it is not too risky to do so. Examining the situation where some players may play, either as trustor or as trustee, we show that this result is robust.
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  • Pierre Courtois & Tarik Tazdaït, 2012. "Learning to trust strangers: an evolutionary perspective," Journal of Evolutionary Economics, Springer, vol. 22(2), pages 367-383, April.
    • Handle: RePEc:spr:joevec:v:22:y:2012:i:2:p:367-383
    DOI: 10.1007/s00191-011-0247-z
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    Cited by:

    1. Jean Paul Rabanal & Daniel Friedman, 2015. "How Moral Codes Evolve in a Trust Game," Games, MDPI, vol. 6(2), pages 1-11, June.

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    More about this item

    Keywords

    Trust; Incomplete information; Replicator dynamics; Evolutionary stable strategy; Threshold; C73; D82; D83;
    All these keywords.

    JEL classification:

    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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