Signs and (counter)signals of trustworthiness

Abstract

When we become aware that our past actions carry information about qualities that we possess or lack, which others use to decide how to deal with us, are we unconcerned, content to rely on what we have done, or do we take action to alter this information? We study this question experimentally using generosity as a sign and a signal of trustworthiness, and a trust game. Subjects play a dictator game unaware that later they will play a trust game and that their level of generosity in the dictator game will be revealed to trusters, with some inaccuracy, before trusters decide whether to trust or not. Once made aware of what follows, trustees have the option to play a second dictator game, from which their choice will be accurately conveyed to trusters in addition to their decision in the initial game. Consistent with ‘countersignalling theory’, those who, in the first dictator game, were either miserly or generous do not play the second dictator game, resigned or content with the information conveyed by their past actions. Those neither miserly nor generous in the first dictator game, an intermediate generous group, are likeliest to use the second dictator game; many of them for the purpose of signalling, so that they are not confused with the miserly.