Document Type
Article
Publication Date
9-30-2026
Abstract
We examine how competitive allocation of scarce participation rights shapes behavior in a Berg-style trust game. Trustor and trustee roles are allocated through multi-unit uniform-price English auctions with varying scarcity, alongside a matched-fee random-assignment control treatment. Positive transfers and returns persist, but behavior lies near the low-trust, low-reciprocity end of comparable benchmarks. Tighter scarcity accelerates the decline in trustor transfers, while trustee returns show no monotonic pattern. Scarcity strongly raises auction prices without comparably raising participants’ gross trust-game earnings, thereby lowering net earnings. Exit bids adjust to past game profitability, indicating adaptive learning about the value of participation.
Recommended Citation
Shachat, J., Swarthout, J. T., & Wang, Y. (2026). Auctioning the right to trust and reciprocate: Scarcity, market allocation, and selection in the trust game. ESI Working Paper 26-12. https://digitalcommons.chapman.edu/esi_working_papers/443/
Comments
ESI Working Paper 26-12