Does betrayal aversion really guide trust decisions towards strangers?

Abstract

Trust is a double-edged sword. When warranted, it leads to positive and rewarding interactions. When not, it leads to disappointment and anger. Therefore, it has been argued that people will display “betrayal aversion” in trust situations (i.e., avoid trusting to avoid betrayal). Yet, people also feel tense and uneasy when they signal distrust to another person and thus show signs of “principled trustfulness” (i.e., choosing to trust others although being skeptical of their trustworthiness). These two theoretical orientations imply directly opposite influences on trust behavior. Thus, we conducted two laboratory studies (with a total of 841 participants) with binary trust games (implying a risk of being betrayed) and extended lottery games (implying no such risk). In both studies, we varied the payoff structures of both games. Further, we made sure that the average perceived likelihood of winning or losing money when choosing the risky option was identical in both games, as was the distribution of these likelihoods. Neither study showed any sign of betrayal aversion. Rather, participants were more willing to risk their money in the trust game than they were to invest their money in a lottery, supporting the principled trustfulness view. We discuss possible explanations why, unlike previous studies, we did not find any indication of betrayal aversion.