Trust and reciprocity: Implications of game triads and social contexts

Abstract This paper uses a triadic experimental design to conduct trust and reciprocity experiments. The experiments with game triads discriminate between transfers resulting from trust or reciprocity and transfers resulting from (intentions-unconditional) other-regarding preferences. Alternative treatments vary the environment of the experiments from a weak to a strong social context. The observations in two social contexts of decisions motivated by other-regarding preferences, trust, and/or reciprocity are central to obtaining empirical information that can guide the process of formulating a theory of utility that can increase the empirical validity of game theory. Data from experiments with the triadic design are used to evaluate recent extensions of theory that incorporate concern for fairness of monetary payoffs and perceptions of others' intentions into agents' utilities