Trust, Truth, Status and Identity: An Experimental Inquiry

Abstract:     
In an experiment involving a standard trust game and a costless signaling game, it is demonstrated that economically relevant norm-based behaviors (trust, reciprocity and truth-telling) vary with social identity. The experimental procedure induced two classes of trivial social identities: one version induced equal-status groups, while another version of the experiment induced unequal-status groups. The results permitted a succinct description of identity effects: individuals exhibit increased concern for situation-specific norms when dealing with in-group members; members of high status groups, on the other hand, feel this extra norm-concern in all of their interactions - i.e., there is a "high status/high standards'' phenomenon, or more traditionally, noblesse oblige. These effects generalize and extend existing results about in-group bias, and reconcile some previously contradictory patterns. To illustrate the "high status/high standards'' phenomenon, subjects' "standards'' were estimated from an Akerlof and Kranton-style identity model for a subset of the data.

Keywords: trust, truth, status, identity, social identity, experiment, honesty, norms, reciprocity

Working Paper Series