Economic Trust Research Articles

The Story of De- dollarization and Internationalization of the Chinese Renminbi

In recent times, numerous commentaries have written about de- dollarization. We analyse the factors which are contributing to de- dollarization. On the economic front, there is reduced fiscal and financial capacity of the US economy that can strain economic trust in the dollar. The internationalization of the Chinese currency is another factor. Additionally, a lower forecast for the world economic growth outlook, a higher debt financing in the United States, and a war in Europe are also leading to central banks around the world buying more gold and reducing investment in the US treasury bonds. While these factors may lead to reduced demand for dollars and increase the use of alternate international currencies, including digital currencies, we argue that dislodging the dollar as a global anchor currency is at best going to be restricted by economic and geopolitical reasons. JEL Codes: E42, F33, F34

Social capital in transactions: The role of economic and social trust in the specialty beef production system in Brazil

Abstract This study aims to understand the social capital inherent in agents and the role of social and economic trust in transactions between beef cattle producers and slaughtering cooperatives in the specialty beef production system in Paraná state, Brazil. This qualitative research involved 31 semi-structured interviews with beef cattle producers, cooperatives, and key agents. Results revealed that social capital, comprising networks and informal norms, favors the condition of trust, enabling the construction of a hybrid governance structure under a complex institutional environment. Social and economic trust between agents facilitates transactions, reduces behavioral and market uncertainties, enables ex-post adaptations, and consequently, reduces monitoring costs and transaction costs. Trust based on social aspects, i.e., social trust, was more relevant for the construction of arrangements, while trust based on economic aspects, i.e., economic trust, had a greater impact on the continuity of arrangements. This reveals that looking at only one of them is not enough to understand contractual arrangements. Thus, this study highlights that unfolding the concept of trust and investigating whether it comes from an economic or social basis is important to understand the complexity of such arrangements, which may influence specialty beef production system design and coordination efficiency.

Building a reputation for trustworthiness: Experimental evidence on the role of the feedback rate

In 25 years, research on reputation-based online markets has produced robust evidence on the existence of the so-called reputation effect, that is the positive relation between online traders’ reputations and these traders’ market success in terms of sales and prices. However, there is an ongoing debate on what the size of the reputation effect means. We argue that the rate of truthful feedback that traders leave after completed transactions is negatively related to the size of the reputation effect. The higher the rate of truthful feedback, the quicker will untrustworthy traders be screened and disincentivized to enter the market. With mostly trustworthy traders entering the market, buyers will demand smaller price discounts from market entrants without a good reputation. We test this mechanism empirically in two laboratory experiments. In both experiments, we systematically vary the probability with which information about sellers’ behavior in an economic trust game is recorded and shown to future interaction partners of these sellers. In the second experiment, we introduce competition among sellers by allowing buyers to choose one of two sellers in each interaction. We find that sellers give discounts to buyers to build or repair their reputation and that sellers who give discounts or have a good reputation are trusted more. However, we do not find support for our hypothesis that a higher feedback rate significantly decreases sellers’ propensity to give discounts. We argue and show in exploratory analyses that this is likely due to the high level of unconditional trust buyers exhibit towards sellers without a reputation. Yet, seller competition increases the propensity to offer discounts among sellers without a reputation the most.

An fMRI Dataset on Social Reward Processing and Decision Making in Younger and Older Adults

Behavioural and neuroimaging research has shown that older adults are less sensitive to financial losses compared to younger adults. Yet relatively less is known about age-related differences in social decisions and social reward processing. As part of a pilot study, we collected behavioural and functional magnetic resonance imaging (fMRI) data from 50 participants (Younger: N = 26, ages 18–34 years; Older: N = 24, ages 63–80 years) who completed three tasks in the scanner: an economic trust game as the investor with three partners (computer, stranger, friend) as the investee; a card-guessing task with monetary gains and losses shared with three partners (computer, stranger, friend); and an ultimatum game as responder to three anonymous proposers (computer, age-similar adults, age-dissimilar adults). We also collected B0 field maps and high-resolution structural images (T1-weighted and T2-weighted images). These data could be reused to answer questions about moment-to-moment variability in fMRI signal, representational similarity between tasks, and brain structure.

Наследие Г.М. Андреевой: роль технологических инноваций в социальных изменениях

Background. Technological innovations have become an important agent of social change, creating new socio-psychological meaning. In this context, G.M. Andreeva's idea that social psychology should help people adapt to changing environments remains relevant. Objectives. This paper aims to highlight the socio-psychological perspective on the role of innovative technologies in social change. We present two empirical studies that demonstrate emerging socio-psychological patterns in the context of open-source software development (study 1) and the use of virtual assistants (VA) for economic decision-making (study 2). Study Participants. Study (1): 900 posts from a collaborative development platform. Study (2): 200 users of the VA popular in Russia, residents of Russian cities with a population of more than 500,000 people. Methods. Study (1): Content analysis using large language models. Study (2): Quantitative online survey assessed users' perception of their VA and previously unknown VA across 15 characteristics, subjective trust levels, and economic trust through scenarios involving monetary transactions. Results. Study (1): A pre-configured GPT-4 turbo model with an instruction consisting of two examples achieved 56% accuracy in classification. Using a fine-tuned model of the previous generation, DeBERTa-v3-Small, increased the efficiency of classifying developer messages by up to 70%. This allowed the model to be used to encode developer interactions in order to identify the factors that contribute to effective collaboration. Study (2): Both forms of trust (declared and economic) are significantly related to components of social representations (SR) of VA. Individual components of these perceptions correlate with both declared and economic trust at the level of r > 0.3, p < 0.05. However, there is a difference in the strength of these relationships for familiar and unfamiliar VAs. An assumption can be made about the possible influence of the duration of use of VA on the strength of connections between SR and trust in VA. Thus, SR formed through interaction with VA contributes to a trusting attitude towards it and, accordingly, to decision-making processes involving its use. Conclusions. Socio-psychological knowledge about the changing socio-psychological meaning can form the foundation for the development of human-centered technologies. As a part of professional work, a developer can improve current tools for the creation, management, and optimization of collaborative activities. In everyday life, it is also important to establish a level of trust that is appropriate for the situation in which a Virtual Assistant is used.

КООПЕРАЦИОННЫЕ ВЗАИМОДЕЙСТВИЯ В АГРОПРОДОВОЛЬСТВЕННОМ КОМПЛЕКСЕ: БАРЬЕРЫ И ПЕРСПЕКТИВЫ РАЗВИТИЯ

In the context of this study, cooperation is considered as a form of joint activity of subjects (usually individuals) with the aim of realizing common interests. The main factors limiting the possibilities for the development of agricultural cooperation include: low level of social and economic trust of the rural population in each other, loss of trust in the cooperative ideology and the priority of private interests, lack of positive examples of the development of cooperation, high level of regression and disunity of rural communities, sporadic and fragmentation of the agricultural cooperation system, low level of financial capabilities of potential cooperators, limited sources of financing investment and operating activities, limited government support funds, low level of investment attractiveness of cooperative associations, shortage of qualified personnel, the need to ensure certain standards of product quality and its compliance with established requirements, etc. It is concluded that the potential for the development of cooperation in the agricultural sector is determined by the significant number of small businesses - potential cooperators, the ability of cooperation to increase the stability of social ties in rural communities and the effectiveness of economic interactions of rural economic entities, the ability of small commodity producers to function successfully in those market niches which are not attractive to large businesses, the possibility of cooperation to create conditions for increasing the level of income of participants in cooperative associations, the possibility of cooperation to saturate local markets in rural areas with high-quality food products and essential goods, the transition to a cluster model of development of agro-industrial integration, which involves easier entry into the cluster system of cooperative small commodity producers, etc.

The Phenomenon of Trust in Domestic Scientific Discourse

This article is devoted to the analysis of the phenomenon of trust in public scientific discourse. The authors consider various approaches to the research of the phenomenon of trust in economics, sociology, psychology and other branches of scientific knowledge. In-depth theoretical and methodological analysis of the understanding of the confidence phenomenon in the interpretation of different sociological directions is conducted. The author’s interpretation of the concept of trust from the point of view of the activity-phenomenological approach is given. The available approaches to the study of trust are systematized. In the empirical part of the research, in order to study how science responded to modern challenges related to trust in the network space in different chronological periods, the method of quantitative and qualitative content analysis was applied on the basis of scientific papers published in the period from 2000 to 2021. On the basis of the results, the authors were able to reproduce a list of 55 areas of knowledge and to derive thematic areas in which the phenomenon of trust is being studied.

Indigenous Organizations Increasingly Being Funded by B.C. Corporation

Laurel Douglas has certainly proven to be a changemaker. Douglas was brought on board as the CEO of ETSI-BC in May 2020. The full name for the British Columbia-based not-forprofit corporation is the Economic Trust of the Southern Interior. ETSI-BC, previously known as the Southern Interior Development Initiative Trust, was launched in 2006 by the B.C. government to administer a $50 million endowment fund that was intended to support economic investment in the southern interior of the province. Governance of the trust is carried out by the 13 individuals who serve on ETSI-BC’s board of directors. Five of the board members are appointed by the province. The other eight are district representatives within ETSI-BC’s coverage area.

In trust we share: The politics of financial intelligence sharing

Financial transactions data are increasingly considered valuable in the context of security threats, yet they are particularly privacy sensitive. At present, 166 Financial Intelligence Units (FIUs) worldwide are able to share financial intelligence via the Egmont Group, their joint platform. This paper analyses the politics and practices of transnational financial intelligence sharing, with a particular emphasis on the Egmont Group. We draw on literatures at the intersection between political economy and financial security to analyse how FIU practitioners rely on what we call ‘circuits of trust’ that enable them to engage in a politics of data-sharing. Drawing on semi-structured interviews and participant observation, we examine three practices: the role of trust in navigating the ‘legal grey zone’ in which FIU data are shared; the way in which trust circuits make intelligence sharing possible; and the implicit notions of (un)trustworthiness at work when FIUs share intelligence, leading to inclusion and exclusion. We aim to push forward the conversation about economic trust practices by observing how the circuit of trust operates in everyday practice, making the sharing of financial intelligence (im)possible.

Children's dynamic use of face- and behavior-based cues in an economic trust game.

Who do children trust? We investigated the extent to which children use face-based versus behavior-based cues when deciding whom to trust in a multiturn economic trust game. Children's (N = 42; aged 8 to 10 years; 31 females; predominantly White) trust decisions were informed by an interaction between face-based and behavior-based cues to trustworthiness, similarly to those of adults (N = 41; aged 17 to 48 years; 23 females; predominantly White). Facial trustworthiness guided children's investment decisions initially, such that they invested highly with trustworthy-looking partners and less with untrustworthy-looking partners. However, by the end of the trust game, after children had experienced game partners' fair or unfair return behavior, they overcame this bias and instead used partners' previous behavior to guide their trust decisions. Using partners' return behavior to guide decisions was the most rational strategy, because partners' facial trustworthiness was not an accurate cue to their actual trustworthiness. This dynamic use of different cues to trustworthiness suggests sophisticated levels of social cognition in children, which may reflect the social importance of trust impressions. (PsycInfo Database Record (c) 2022 APA, all rights reserved).

Trust-Based Decision-Making in the Health Context Discriminates Biological Risk Profiles in Type 1 Diabetes.

Theoretical accounts on social decision-making under uncertainty postulate that individual risk preferences are context dependent. Generalization of models of decision-making to dyadic interactions in the personal health context remain to be experimentally addressed. In economic utility-based models, interactive behavioral games provide a framework to investigate probabilistic learning of sequential reinforcement. Here, we model an economic trust game in the context of a chronic disease (Diabetes Type 1) which involves iterated daily decisions in complex social contexts. Ninety-one patients performed experimental trust games in both economic and health settings and were characterized by a multiple self-report set of questionnaires. We found that although our groups can correctly infer pay-off contingencies, they behave differently because patients with a biological profile of preserved glycemic control show adaptive choice behavior both in economic and health domains. On the other hand, patients with a biological profile of loss of glycemic control presented a contrasting behavior, showing non-adaptive choices on both contexts. These results provide a direct translation from neuroeconomics to decision-making in the health domain and biological risk profiles, in a behavioral setting that requires difficult and self-consequential decisions with health impact. Our findings also provide a contextual generalization of mechanisms underlying individual decision-making under uncertainty.

Age-related differences in ventral striatal and default mode network function during reciprocated trust

Social relationships change across the lifespan as social networks narrow and motivational priorities shift to the present. Interestingly, aging is also associated with changes in executive function, including decision-making abilities, but it remains unclear how age-related changes in both domains interact to impact financial decisions involving other people. To study this problem, we recruited 50 human participants (Nyounger = 26, ages 18–34; Nolder = 24, ages 63–80) to play an economic trust game as the investor with three partners (friend, stranger, and computer) who played the role of investee. Investors underwent functional magnetic resonance imaging (fMRI) during the trust game while investees were seated outside of the scanner. Building on our previous work with younger adults showing both enhanced striatal responses and altered default-mode network (DMN) connectivity as a function of social closeness during reciprocated trust, we predicted that these relations would exhibit age-related differences. We found that striatal responses to reciprocated trust from friends relative to strangers and computers were blunted in older adults relative to younger adults, thus supporting our primary pre-registered hypothesis regarding social closeness. We also found that older adults exhibited enhanced DMN connectivity with the temporoparietal junction (TPJ) during reciprocated trust from friends compared to computers while younger adults exhibited the opposite pattern. Taken together, these results advance our understanding of age-related differences in sensitivity to social closeness in the context of trusting others.

Protecting Farmers and Workers in Socialist Market Transitions: Mass Attitudes Toward Imports in Asia

After decades of market liberalization in Asian countries, how do people see trade, mainly imports, as potentially hurting domestic production? Do they consider them a threat to their societies’ less privileged groups? Using survey data of China, Vietnam, and Cambodia, and citing Thailand as a comparative case representing a liberal economy in the Southeast Asian region, we examine the effect of economic interests, collectivist ideology, and political trust on trade preferences. Empirical results indicate that economic optimism is only weakly related to attitudinal openness to imports, while income has a mixed effect. Collectivism and political trust in the central government and the elite stimulate antipathy against imports. The findings shed light on the sources of protectionist attitudes in Asian authoritarian regimes undergoing socialist market transition among the general public.

Supplemental Material for Children’s Dynamic Use of Face- and Behavior-Based Cues in an Economic Trust Game

Supplemental Material for Children’s Dynamic Use of Face- and Behavior-Based Cues in an Economic Trust Game

Switching Intent of Disruptive Green Products: The Roles of Comparative Economic Value and Green Trust

This study explores consumers’ motivations to switch to new products in the context of disruptive innovation and investigates the role of comparative economic value and green trust. Switching from an existing product to a disruptive green product not only involves benefits but also requires major sacrifices, which are not encountered in the context of continuous innovation. In this study, the relationships between comparative economic value, green trust, self-accountability, and disruptive green product switching intent are examined. Data were collected from China with self-administered questionnaires regarding the disruptive green product. Results of a structural model reveal positive relationships between comparative economic value, green trust, and disruptive green product switching intent. In addition, green trust mediates the effects of the comparative economic value on the disruptive green product switching intent, and self-accountability moderates the relationship between green trust and disruptive green product switching intent. From a practitioner perspective, the research is important because it illuminates the consumer’s motivations regarding product switching in the hitherto unexplored field of automobiles, for which we have shown that our extended model yields meaningful results.

Coordination Between Tobacco Resource Development and Regional Economy

Objectives: This paper studies the relationship between the development of tobacco resources and the coordination of regional economy under the background of tobacco monopoly. Methods: This paper takes the institutional change theory as the theoretical fulcrum and the cost-benefit analysis as the main line, the correlation between regional economy and the development of tobacco industry is compared. This paper expounds the evolution history and institutional characteristics of China's tobacco monopoly system, and analyzes the changes of production, supply and marketing relationship, institutional characteristics and benefit distribution of the tobacco industry in each period. After the theoretical and empirical analysis of the costs and benefits of China's tobacco monopoly system, this paper studies the role of tobacco resource development in promoting regional economy by comparing the costs and benefits of radical and gradual reform. Results: On the premise of retaining tobacco monopoly, we should take the separation of government and enterprises and the reform of tobacco fiscal and tax system as the breakthrough. This can change the tobacco industry from administrative monopoly to economic monopoly and form tobacco trust. The linkage mechanism of "tax, profit and price" should be established to protect the interests of tobacco farmers. A tobacco auction center shall be established and a third-party tobacco rating agency shall be guided. Conclusion: The net income of the new system is higher than that of the old system. The healthy development of tobacco industry can promote regional economy.

Socially Induced Negative Emotions Elicit Neural Activity in the Mentalizing Network in a Subsequent Inhibitory Task

Despite the growing emphasis on embedding interactive social paradigms in the field of cognitive and affective neuroscience, the impact of socially induced emotions on cognition remains widely unknown. The aim of the present study was to fill this gap by testing whether facial stimuli whose emotional valence was acquired through social learning in an economic trust game may influence cognitive performance in a subsequent stop-signal task. The study was designed as a conceptual replication of previous event-related potential experiments, extending them to more naturalistic settings. We hypothesized that response inhibition to briefly presented faces of negative and positive game partners would be enhanced on the behavioral and neural levels as compared to trials with a neutral player. The results revealed that the trust game was an effective paradigm for the induction of differently valenced emotions towards players; however, behavioral inhibitory performance was comparable in all stop-signal conditions. On the neural level, we found decreased P3 amplitude in negative trials due to significantly stronger activation in the right frontoparietal control network, which is involved in theory-of-mind operations and underlies social abilities in humans, especially memory-guided inference of others’ mental states. Our findings make an important contribution to the cognition–emotion literature by showing that social interactions that take place during an economic game may influence brain activity within the mentalizing network in a subsequent cognitive task.

Children show economic trust for both ingroup and outgroup partners

Trust is a critical aspect of human cooperation, allowing individuals to overcome the risks posed by such interactions because of others’ presumed cooperative inclinations. Adults sometimes mitigate these risks by preferentially trusting members of their own social group, yet it is currently unclear if the early emergence of children’s trust in others’ cooperative tendencies is affected by their intergroup psychology. Here we tested whether group membership impacts two key aspects of trust-based cooperation in young children – their trust in others’ willingness to reciprocate an investment (assessed using the Investment Game, Study 1), and their trust in others’ generosity (assessed using the Faith Game, Study 2). In both studies, children assigned to novel and otherwise arbitrary groups demonstrated general preferences for ingroup members on several measures. However, group membership did not influence their decisions about economic trust. In Study 1, 4- and 6-year-old children showed high levels of trust in both ingroup and outgroup members’ tendency to reciprocate an investment. In Study 2, 6- to 7-year-old children similarly showed high levels of trust in ingroup and outgroup members’ generosity, and they did so regardless of whether their group membership was a matter of common knowledge between themselves and the trustee. These findings show that young children’s preferences for ingroup members do not result in bias due to shared group membership when making economic trust decisions. Rather, children tend to exhibit trust in the cooperativeness of others regardless of group membership.

Perspective taking reduces intergroup bias in visual representations of faces

Intergroup biases shape most aspects of person construal, including lower-level visual representations of group members' faces. Specifically, ingroup members' faces tend to be represented more positively than outgroup members' faces. Here, we used a reverse-correlation paradigm to test whether engaging in perspective taking (i.e., actively imagining another person's mental states) can reduce these biased visual representations. In an initial image-generation experiment, participants were randomly assigned to a minimal group and then composed a narrative essay about an ingroup or an outgroup target person, either while adopting the person's perspective or while following control instructions. Afterward, they generated an image of the person's face in a reverse-correlation image-classification task. Subsequent image-assessment experiments using an explicit rating task, a sequential priming task, and an economic trust game with separate samples of participants revealed that ingroup faces elicited more likability and trustworthiness than did outgroup faces. Importantly, this pattern of intergroup bias was consistently weaker in faces created by perspective takers. Additional image-assessment experiments identified the mouth (i.e., smiling cues) as a critical facial region wherein the interactive effects of group membership and perspective taking emerged. These findings provide initial evidence that perspective taking may be an effective strategy for attenuating, though not for eliminating, intergroup biases in visual representations of what group members look like.

Facial Stereotype Bias Is Mitigated by Training

People automatically infer others’ personality (e.g., trustworthiness) based on facial appearance, and such facial stereotype biases predict real-world consequences across political, legal, and business domains. The present research tested whether these biases can be mitigated through counterstereotype training aimed at reconfiguring the associations between specific facial appearances and social traits. Across six studies and a replication, a behavioral counterstereotype training consistently reduced or eliminated facial stereotype biases for White male faces in the context of economic trust games, hiring decisions, and even automatic evaluations assessed via evaluative priming. Together, the results demonstrate a fundamental malleability in facial stereotyping related to trustworthiness, with a minimal training able to mitigate the tendency to activate and apply long-held, highly automatized facial stereotypes. These findings suggest that face impressions are more flexible than typically appreciated, and they provide a potential inroad toward combating our ingrained biases based on facial appearance.