Recordkeeping Alters Economic History by Promoting Reciprocity

Proceedings of the National Academy of Sciences, Vol. 106, No. 4, pp. 1009-1014, January 27, 2009

Posted: 21 Jan 2009

See all articles by Sudipta Basu

Sudipta Basu

Temple University - Department of Accounting

John W. Dickhaut

Chapman University (Deceased)

Gary Hecht

University of Illinois at Urbana-Champaign

Kristy L. Towry

Emory University

Gregory B. Waymire

Emory University - Department of Accounting

Multiple version iconThere are 2 versions of this paper

Date Written: January, 19 2009

Abstract

We experimentally demonstrate a causal link between recordkeeping and reciprocal exchange. Recordkeeping improves memory of past interactions in a complex exchange environment, which promotes reputation formation and decision coordination. Economies with recordkeeping exhibit a beneficially altered economic history where the risks of exchanging with strangers are substantially lessened. Our findings are consistent with prior assertions that complex and extensive reciprocity requires sophisticated memory to store information on past transactions. We offer fresh insights on this research by scientifically demonstrating that reciprocity can be facilitated by information storage external to the brain. This is consistent with the archaeological record, which suggests that pre-historic transaction records and the invention of writing for recordkeeping were linked to increased complexity in human interaction.

Keywords: accounting, economic institutions, trust, memory, image score

JEL Classification: B25, C91, D80, M40, N00

Suggested Citation

Basu, Sudipta and Dickhaut, John and Hecht, Gary and Towry, Kristy L. and Waymire, Gregory B., Recordkeeping Alters Economic History by Promoting Reciprocity (January, 19 2009). Proceedings of the National Academy of Sciences, Vol. 106, No. 4, pp. 1009-1014, January 27, 2009. Available at SSRN: https://ssrn.com/abstract=1330060

Sudipta Basu

Temple University - Department of Accounting ( email )

Philadelphia, PA 19122
United States
215.204.0489 (Phone)
215.204.5587 (Fax)

John Dickhaut

Chapman University (Deceased)

Gary Hecht

University of Illinois at Urbana-Champaign ( email )

601 E John St
Champaign, IL 61820
United States

Kristy L. Towry

Emory University ( email )

Goizueta Business School
1300 Clifton Road
Atlanta, GA 30322
United States
404-727-4895 (Phone)

Gregory B. Waymire (Contact Author)

Emory University - Department of Accounting ( email )

Goizueta Business School
1300 Clifton Road
Atlanta, GA 30322
United States
404-727-6589 (Phone)
404-727-6313 (Fax)

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