buchan buchan buchan recruit

An International Investigation of the Influence of Social Distance on Trust

Let’s Get Personal: An International Examination of the Influence of Communication, Culture and Social Distance on Trust and Trustworthiness

Nancy R. Buchan – Univ. of WisconsinRachel T.A. Croson – Univ. of Pennsylvania

Eric J. Johnson – Columbia University

Goal of Research

How does trust manifest itself in different countries and different contexts?Four countries

China, Japan, Korea, United States

Two cultural orientationsSocial DistancePersonal vs. Impersonal Communication

Perspective: Experimental Economics The Trust Game (Berg, Dickhaut & McCabe 1995)

Standard trust game Both parties receive $10 participation fee Amount sent is tripled, responder is a dictator with total One-shot, real money

Deviations from equilibrium – trust, trustworthiness

The Influence of Social Distance

Need to incorporate social distance to explain individual decisions bearing social consequences (Akerlof 1997)

Definition: Location in a social space (Akerlof 1997)

Degree of isolation from each other and experimenter (Hoffman, McCabe and Smith 1996)

Demographic similarity (Glaeser et al. 2000)

Social Distance and Culture

Minimal Group Paradigm (Tajfel et al. 1971)

Arbitrary categorization into mutually exclusive groups Significant ingroup bias in the United States (Orbell, van

de Kragt & Dawes 1988; Frey & Bohnet 1997)

The Influence of Culture on Group Definition and Formation Permanent / Natural groups vs. Temporary / Artificial

(Triandis 1995) Likely resistance from collectively oriented

participants (Mann, Radford, & Kanagawa 1985)

Social Distance and Culture

Hypothesis (tested at the aggregate and individual levels): Countries (US) / Individuals with relatively

more individualist orientation will display an ingroup bias.

Countries (China, Japan, Korea) / Individuals with relatively more collectivist orientation will not display an ingroup bias.

The Influence of Communication

Communication increases cooperation rates in SDs (Sally 1995) Why? Must communication be strategy-relevant?

Irrelevant communication (“cheap talk”) Roth (1995): 2-min., face to face, social discussion

Led to same amounts of increase in cooperation as relevant communication

Dawes, McTavish, & Shaklee (1977): 10-min., face to face, fact-related discussion

Led to same amount of cooperation as no communication

Irrelevant Content

Compare 2 types of irrelevant communication Personal Impersonal

Hypothesis: Among in-group pairings, participants who engage in

personal communication will display higher levels of trust and trustworthiness than those who engage in impersonal communication.

Experiment Participants

188 Ss – sophomore or junior business or economics majors50 Ss: Nankai University – China50 Ss: Seoul National University – Korea44 Ss: University of Tokyo – Japan44 Ss: University of Pennsylvania - US

Experiment Procedures - Communication Participants randomly assigned to one of

four color-coded groups (~ 12 members)Personal communication: Ss told to introduce

themselves and to discuss, from a list provided, a question pertaining to their birthdays

Impersonal communication: Ss told to answer from the given list, questions obtained from the world almanac

Experiment Procedures – Trust Game Participants randomly assigned to roles

(sender / responder), and directed to separate rooms

Received written instructions for game, experimental fee, and 2 colored index cards Numbered card represented color of Ss own

discussion group, and ID number Blank card represented color of partner’s discussion

group

Experimental Procedures

Double-blind Controls (Roth et al. 1999):

Ss pool equivalencyCurrency effects: 2,000 yen, 1,000 won,

10 yuan, $10 dollarsLanguage effectsExperimenter effectsComprehension

Experimental Questionnaire Senders: Completed after sending money

but before receiving any back Responders: Completed before receiving

money from senders Hypothetical games (next study)

Measures of Cultural Orientation

Cultural orientation: Broad measures of culture reflecting two fundamental differences in culture (Hofstede 1980; Triandis et al. 1988)

Competition vs. Cooperation “To what extent does it feel like you are competing or

cooperating with the responder (sender) in this experiment?”

Priority on self vs. group “What is more important to you in this experiment, maximizing

the amount of money that you and the (sender) responder will gain, or maximizing the amount of money you alone will gain?”

Experimental Results

Dependent Variables:Trust: Amount sent by senderTrustworthiness: Proportion of total wealth

returned by responder

Monetary amounts across countries standardized on scale from 0 to 1,000 units

Amount Sent Independent Variable Estimate St Dev t Value Intercept 457.45 53.06 13.44 ** Communication 278.23 52.93 2.51 * Groups 221.61 53.53 -0.90 China 278.67 37.18 1.41 ^ Japan 237.19 38.59 0.62 Korea 69.96 36.59 0.46 Comm*Groups 29.76 26.69 0.20 Comm*China -108.99 37.94 1.28 Comm*Japan -142.42 38.07 -0.63 Comm*Korea -3.51 36.55 0.78 Groups*China -328.16 38.00 -2.53 * Groups*Japan -309.03 38.85 0.97 Groups*Korea -137.41 36.59 -1.00 Gender -81.40 37.30 -0.30 Economics Educaton 41.20 34.25 -0.53

Adjusted R2 0.06 # of Observations 92 **p<.01 * p<.05 ^ p<.10

Country x Social Distance

Amount Sent (Country by Social Distance)

0

100

200

300

400

500

600

700

800

900

1000

China Japan Korea US

Am

ou

nt

Se

nt

Ingroup

Outgroup

Cultural Orientation

Independent Variable Estimate St Dev t Value Intercept 9.1590 1.2200 7.57 ** China 1.9140 1.4600 2.05 * Japan 0.6740 1.5200 -0.33 Korea 0.3940 1.4500 -0.31 Groups 0.0060 1.2900 0.59 Communication 0.3520 1.2800 -0.25 Proposer 0.3510 1.2800 -0.16

Adjusted R2 0.12 Number of Observations 184 **p<.01 * p<.05

Cultural Orientation x Social Distance

Amount Sent (Cultural Orientation by Social Distance)

0

100

200

300

400

500

600

700

800

900

1000

Collectivist Individualist


Am

ou

nt

Se

nt

Ingroup

Outgroup

Cultural mediation Independent Variable Estimate St Dev t Value Intercept 460.24 48.23 14.76 ** Communication 108.43 47.65 2.28 ** Groups -65.16 47.47 -1.37 Cultural Orientation -316.65 48.08 -1.98 * China 28.35 33.85 0.84 Japan 27.76 34.08 0.81 Korea 10.55 32.42 0.33 Culture*China -38.31 33.74 -1.42 Culture*Japan -20.28 33.91 -0.60 Culture*Korea -32.31 34.22 -0.94 Comm*Culture -9.25 24.22 -0.38 Groups*Culture -73.94 34.03 -2.17 * Comm*China 72.67 33.41 1.18 Comm*Japan -27.20 33.58 -0.81 Comm*Korea 11.89 33.94 0.35 Comm*Groups 3.00 24.19 0.12 Groups*China -29.00 24.55 -1.18 Groups*Japan -28.33 34.47 -0.82 Groups*Korea -51.54 32.28 -1.30 Gender -61.25 65.33 -0.60 Economics Education 54.20 33.70 -0.43


Communication – Main effect

Amount Sent (Communication by Social Distance)

0

100

200

300

400

500

600

700

800

900

1000

PersonalCommunication

ImpersonalCommunication

Am

ou

nt

Se

nt

Ingroup

Outgroup

.

Proportion Returned Independent Variable Estimate St Dev t Value Intercept 0.1053 0.0369 10.60 ** Communication 0.1331 0.0318 1.99 * Groups 0.1512 0.0315 1.30 China 0.2140 0.0230 2.08 * Japan 0.1155 0.0244 1.34 Korea 0.0587 0.0241 1.35 Comm*Groups 0.1345 0.0158 -2.13 * Comm*China -0.0544 0.0231 -0.59 Comm*Japan -0.0030 0.0233 0.03 Comm*Korea -0.0162 0.0231 -0.18 Groups*China -0.1821 0.0224 -2.03 * Groups*Japan -0.0638 0.0232 -0.69 Groups*Korea -0.0481 0.0223 0.54 Gender -0.0985 0.0200 2.46 ** Economics Education 0.0261 0.0240 -0.21


Country x Social Distance

Proportion Returned(Country by Social Distance)

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

0.45

0.50

China Japan Korea US

Pro

po

rtio

n R

etu

rne

d

Ingroup

Outgroup

Cultural Orientation x Social Distance

Proportion Returned(Cultural Orientation by Social Distance)

0.00

0.10

0.20

0.30

0.40

0.50

Collectivist Individualist


Pro

po

rtio

n R

etu

rne

d

Ingroup

Outgroup

Cultural Mediation Independent Variable Estimate St Dev t Value Intercept 0.1742 0.0903 1.93 ** Communication -0.0413 0.0204 -2.02 ** Groups 0.0244 0.0538 0.45 Cultural Orientation 0.0200 0.0085 2.35 ** China 0.0177 0.0693 0.26 Japan 0.0311 0.0595 0.52 Korea 0.0682 0.0566 1.20 Culture*China -0.0045 0.0045 -1.00 Culture*Japan -0.0219 0.0214 -1.03 Culture*Korea 0.0004 0.0211 0.02 Comm*Culture -0.0140 0.0206 -0.68 Groups*Culture -0.0208 0.0524 -1.79 ^ Comm*China -0.0240 0.0208 -1.16 Comm*Japan -0.0009 0.0200 -0.05 Comm*Korea 0.0003 0.0063 0.05 Comm*Groups -0.0023 0.0059 -0.39 Groups*China -0.0266 0.0145 -1.84 Groups*Japan 0.0034 0.0044 0.77 Groups*Korea -0.0001 0.0059 -0.01 Gender 0.0356 0.0185 1.93 ** Economics Educaton 0.0351 0.0125 0.56

Adjusted R2 0.41 Number of Observations 92 **p<.01 * p<.05 ^ p<.10

Effect of Communication

Proportion Returned (Communication by Social Distance)

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

0.45

0.50

PersonalCommunication

ImpersonalCommunication

Pro

po

rtio

n R

etu

rne

d

Ingroup

Outgroup

Discussion

The interaction of cultural orientation with social distanceCulturally influenced definitions and methods

of group formation may moderate extent to which ingroup bias in trust is demonstrated (see also Buchan, Croson & Dawes, AJS, 2002)

Implications for research methods used

Discussion

The content of non-strategy relevant communication influences the level of trust displayed

3 explanations for this result: Social Distance (Hoffman, McCabe & Smith 1996)

Decreasing social distance = higher trust

Social Identity (Brewer 1991; Tyler and Dawes 1993) Group identity increases expectations that members of

ingroup will return money

Discussion

Proposed explanation for communication effectPersonal communication prompts

greater “otherregardingness” (Bohnet & Frey 1999)

Examination of outgroup results reveals “carryover” effect of communication

A representative heuristic at play? (Kahneman & Tversky 1972)

Conclusion

“Cheap Talk” isn’t so cheap Our results regarding trust and

trustworthiness concur with Schelling (1968) who suggested, the more we know, the more likely we are to care.

The Boundaries of Trust: Own and Others’ Actions in the US and China

Nancy R. Buchan, University of Wisconsin

Rachel T.A. Croson, University of Pennsylvania

Exploring the Boundaries of Trust

Putting Fukuyama’s ideas to test (1995) Trust levels vary by country – US > China Location of trust boundary varies by country

US boundary is wide – including non-kin China boundary is close and tight – limited to family

members

Trust: “…the expectation of cooperative behavior based on commonly shared norms.”

Trust Games with Hypothetical Targets Examining trust and trustworthiness within

naturally occurring social networks

7 targets varying in social distance (similar to Kollock 1998) Parent Sibling Cousin Student know well Student from another university Stranger from hometown Stranger from another country

Intentions and Expectations

2 types of measures collected: Intention Expectation

Senders: “Imagine you were doing this experiment with the following responders. Please state how much you would send the responder, and how much you would expect to receive back from the responder.”

Responders: “Imagine you were doing this experiment with the following senders. Please state how much you would expect to receive from the sender, and how much you would return to them.”

Measures elicited during play of actual trust game Focusing on China and the US since they represent Fukuyama’s

starkest predictions.

Social Distance Hypothesis

Although decreases in trust and trustworthiness are expected as social distance increases for both American and Chinese participants, the drop in levels of trust and trustworthiness among Chinese participants between family and non-family members will be significantly greater than the drop in trust and trustworthiness among American participants.

Social Norm Hypothesis

Ostrom (2003): “Once some members of a population acquire norms of behavior, the presence of these norms affect the expectations of other players,” (p.41).

Expectations of the trusting actions of others will decrease as social distance increases in both the US and in China.

Expectations of the trustworthy actions of others will decrease as social distance increases in both the US and in China.

Method of Analysis

Mixed-model repeated ANOVA Amounts sent standardized scale 1-10 units Converted absolute amounts returned to

proportions returned. Covariates:

Exposure to game theory Gender – replicating prior results (Croson and Buchan

AER 1999, previous study)

Comparison with Actual Game

Actual game: participants paired with anonymous student from same university

Hypothetical: Between “Student you know well,” and “Student from another university”

Amount Sent

Proportion Returned

USActual 4.95 22%Student Know Well

7.31 35%

Student Another University

4.04 22%

ChinaActual 6.62 35%Student Know Well

8.12 35%

Student Another University

5.41 30%

Amount Sent – Sender’s Intentions

As social distance increases, amounts sent decrease (F(7,308)=70.17,

p<.01) China’s tighter boundary

of trust? No social distance x target

interaction

Figure 2: Amount Proposers Would Send Across Countries

0

1

2

3

4

5

6

7

8

9

10

Parent Sibling Cousin Student YouKnew Well

Student fromAnother

University

Stranger fromHome Town

Stranger fromAnother Country

Responder

Am

ou

nt

China (n=24) United States (n=22)

Amount Sent – Responder's Expectations As social distance

increases, expectations decrease (F(7,315)=36.6, p<.01)

Significant country x recipient interaction (F(7,315)=10.64, p<.01)

Figure 3: Amount Responders Expect to Receive Across Countries

0

1

2

3

4

5

6

7

8

9

10


Student fromAnother

University


Stranger fromAnotherCountry

Proposer

Am

ou

nt


Proportion Returned – Responder’s Intentions As social distance

increases, amounts sent

decrease (F(7,315)=20.06, p<.01)

China’s tighter boundary of trust? Again, no social distance x

target interaction

Figure 4: Proportion Responders Would Return Across Countries

0.00

0.10

0.20

0.30

0.40

0.50

0.60

0.70

0.80

0.90

1.00


Student fromAnother

University


Stranger fromAnotherCountry

Proposer

Am

ount


Proportion Returned – Sender’s Expectations Significant country x

recipient interaction (F(7,308)=8.72, p<.01)

Figure 5: Proportion Proposers Would Expect To Have Returned Across Countries

0.00

0.10

0.20

0.30

0.40

0.50

0.60

0.70

0.80

0.90

1.00

Parent Sibling Cousin StudentYou Knew

Well

Studentfrom

AnotherUniversity

Strangerfrom

HomeTown

Strangerfrom

AnotherCountry

Responder

Am

ount


What do these interactions mean?

Directly compare the actions senders or responders report they would take with the expectations about those actions from responders or senders.

Analysis: Repeated measures anovas using intentions and expectations as the DV, role as the IV (for both sending and returning)

US Comparison

Sending

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

10.00


Student fromAnother

University

Stranger fromHome Tow n


Recipient

Am

ount

Amount Proposers Would Send Amount Responders Expect to Receive

Returning

0.00

0.10

0.20

0.30

0.40

0.50

0.60

0.70

0.80

0.90

1.00


Student fromAnother University

Stranger fromHome Tow n


RecipientA

mou

nt

Proportion Proposers Would Expect to Have Returned to Them Proportion Responders Would Return

US Comparison

No significant effect of role for either sending or returning – thus the levels of lines are the same.

Significant effect of counterpart for both sending and returning – thus the slopes of the lines are significant and negative.

Interactions are not significant – the slopes of the lines are the same as each other.

Strong relationship between intended behaviors and expectations in US.

China - Comparison

Sending

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

10.00


Student fromAnother

University



Recipient

Am

ount

Amount Proposers Would Send Amount Responders Expect to Receive

Returning

0.00

0.10

0.20

0.30

0.40

0.50

0.60

0.70

0.80

0.90

1.00


Student fromAnother

University



Recipient

Am

ount

Proportion Proposers Would Expect to Have Returned to Them Proportion Responders Would Return

China Comparison

Significant interactions for both sending and returning – the slopes of the lines are the different from each other.

Intended actions are more responsive to social distance than expectations.

Weak relationship between intended actions and expectations in China.

Discussion

Lack of support for Fukuyama’s tighter boundary of trust in China

Strong support for influence of social distance in both countries among natural groups Counterpoint to findings in previous studies with experimental

groups Stresses the importance of (embeddedness in) personal

networks of relationships in building trust (Granovetter 1985) Trust in China can occur outside kin (despite “bamboo network”)

3 categories of interpersonal relationships based on expressive, instrumental, or mixed ties (Bond and Hwang 1995)

The connection between own and other’s actions US: Responders’ expectations about

proposers’ reactions to social distance are consistent with proposers’ actual reactions, and vice versa.

China: Expectations are systematically less consistent.Actors are sensitive to social distance, but

neither expects the other side to be.

Role of Norms

Apriori expectations: In collectivist cultures strict norms governing

behavior in different contexts (Bond & Hwang 1986); adherence to norm demanded (Bierbrauer et al. 1994).

In individualist cultures, variety of norms is tolerated (Bierbrauer et al. 1994).

Test of variances yields no distinct pattern

Comparison of Individual’s Own Actions with His Expectations Correlation analysis: What a proposer says he

will send to each counterpart vs. what he expects to receive from each.

Parent Sibling Cousin

Student You Knew

Well

Student from Another

University

Stranger from Home

Town

Stranger from Another Country

United States 0.336 0.709 0.815 0.764 0.775 0.808 0.833 China 0.175 0.153 0.425 0.465 0.731 0.641 0.394

Data from Actual Game

Correlation analysis: What proposers sent vs. what they expected to receive back.

US: r = .794, p<.01 China: r = .384, p<.09

Possible Explanations

Projection (Dawes, McTavish & Shaklee 1977)Americans are more likely than Chinese to

project own behavior onto others in situations involving possibility of cooperation.

Avoidance of “Renqin” (King 1991) If you do not wish to be indebted to others,

you do not expect favors from them.

Implications of micalibration

Central premise in trust research: trust is based on positive expectations of reciprocity (Rousseau et al. 1998)Perhaps there are motivations for trust other

than expectations of reciprocity.Or, possibly the strength of expectations as a

motivation for cooperative behavior varies across countries.

buchan buchan buchan recruit

Documents

social discussionled

social space akerlof

social consequences

equilibrium trust

memberspersonal communication

influence of culture

standard trust game

higher levels of trust