Cooperative Membership as a Trust and Trustworthiness Reinforcing Device: Results from a Field Experiment in the Philippines
Journal of Development Studies, Taylor & Francis Journals, vol. 49(3), pages 412-425, 2012
Posted: 30 Jan 2014
Date Written: December 07, 2012
We test the hypothesis that cooperative membership is a trust and trustworthiness reinforcing device and that, as such, it affects (in a trust game) both trustors' and trustees' transfers and beliefs. In considering trust games played by sugar farmers in the Philippines, we find that (i) cooperative membership induces higher levels of trust and trustworthiness even in non-members because the players' behaviour is influenced by the information about their counterparts' cooperative membership status; (ii) an in-group bias is at work since, contrary to non-members' expectations, the positive affiliation-trustworthiness link works only among cooperative members.
Keywords: investment game, trust, cooperation, signalling
JEL Classification: C93, O12, D03
Suggested Citation: Suggested Citation