Incomplete promises and the norm of keeping promises

Abstract

Promises, like contracts, are inherently incomplete and rarely specify what the promisor ought to do in different possible contingencies, thereby being apt to be interpreted differently by the promisor and promisee, with their conflicting interests, and in a self-serving manner whenever circumstances change. This article studies the effect of the incompleteness of a promise on the decision to keep the promise and on individual beliefs that are relevant for the social norm of keeping promises. It investigates, in a laboratory experiment, how individuals form beliefs about how promisors behave, how promisees expect promisors to behave, and how neutral individuals evaluate the immorality of breaking promises when a contingency that was not explicitly addressed by the promise materializes. Promisors distort their beliefs to breach without incurring guilt or moral costs when the promise is incomplete, but even neutral individuals believe that breach is more socially acceptable in this case. Results further reveal substantial heterogeneity in individual beliefs, providing insights into why people do not always respect a fundamental social norm such as keeping promises, at times violating it and at times keeping it.