Working Paper: CEPR ID: DP7717
Authors: Fabian Bornhorst; Andrea Ichino; Oliver Kirchkamp; Karl Schlag; Eyal Winter
Abstract: We run an experiment in which students of different European nationalities are matched in groups of five and repeatedly choose with whom within their group they want to play a trust game. Participants observe of each other age, gender, nationality and number of siblings. The region of origin, "North" or "South" is a major determinant of success in the experiment. Participants tend to trust those they trusted before and who trusted them. We do not find evidence of regional discrimination per se. It is only the underlying and significant differences in behavior that translate through repeated interactions into differences in payoffs between the two regions.
Keywords: trust; trustworthiness; european regions; experiments
JEL Codes: C91; C92; Z13
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Region of origin (R23) | Trust behaviors (Z13) |
| Region of origin (R23) | Economic outcomes (F69) |
| Trust behaviors (Z13) | Economic outcomes (F69) |
| Past interactions (L14) | Future partner selections (C52) |
| Investment behavior (G11) | Average payoffs (J33) |
| Networking effects (D85) | Average payoffs (J33) |
| Selection bias (C24) | Average payoffs (J33) |
| Cultural differences (Z19) | Economic performance (P17) |
| Trust breeds trust (Z13) | Future trust behaviors (D15) |