Evolving trust in business relationships – A behavioural experiment

Gelei, Andrea ORCID: and Dobos, Imre ORCID: (2022) Evolving trust in business relationships – A behavioural experiment. Acta Oeconomica, 72 (2). pp. 231-247. DOI

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Using situation-specific and dyadic data, we analyse how trust in inter-organisational relationships evolve over time. Based on a multidisciplinary approach, we define four trust-related concepts, which include both behavioural and perceptual aspects of this multifaceted phenomenon. We also develop the hypothesis that the behavioural consistency of the trustee affects the level of his/her trustworthiness as perceived by the trustor. To test this hypothesis, the paper specifies a finite Dynamic Trust Game that, in a unique way, models longer-term relationships characterised by interdependent actions between partners. In contrast to the simple Repeated Games modelling discrete exchange episodes, this game corresponds to the requirements of the interaction approach of the relationship management, since the iterations of the game are interrelated and embedded in previous ones. Timely development of the behavioural variables in the game reflects an inverse U-shape with an increasing willingness to cooperate until round 8, with a maximum cooperation level of 80% on average. Behaviour seems to affect the perceived level of trustworthiness. However, we need additional experimental data on inconsistent behaviours to get a clear understanding of this effect.

Item Type:Article
Uncontrolled Keywords:finite dynamised trust game, time, behavioural consistency, business relationship
JEL classification:C79 - Game Theory and Bargaining Theory: Other
D90 - Intertemporal Choice: General
M20 - Business Economics: General
Subjects:Decision making
Business economics
ID Code:7465
Deposited By: MTMT SWORD
Deposited On:28 Jun 2022 09:32
Last Modified:28 Jun 2022 09:32

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