Posted by: Martin | September 7, 2010

The Issue of Trust – follow up

Not Polyannas

I found a quite interesting paper called Not Polyannas: High Generalized Trust Predicts Lie Detection Ability by two researchers at the University of Toronto.

It’s about an experiment where participants first make a web survey that measures their generalized trust, ie if they generally trust other people.

People vary in their trusting propensities: Some, who assume that others are generally trustworthy, make themselves vulnerable to their counterparts until evidence challenges their trustworthiness assumptions; others assume that people are generally untrustworthy and act accordingly until their counterparts demonstrate their trustworthiness gradually over time.

Then participants watched videos of simulated job interviews in which half of the interviewees were truthful, and the other half told lies to make them appear as strong candidates for the job. The participants were asked to make judgements about each interviewee including whether the interviewee had lied, how confident they were about this conclusion, to evaluate the interviewees overall trustworthiness and honesty, and whether they would hire the interviewee.

Results

Contrary to popular belief, it turned out that high trusters were better lie detectors than low trusters, less gullible, and formed more appropriate impressions and hiring intentions.

The paper says the following about the reasons behind the observed result:

Yamagishi (2001) has theorized that generalized trust is a form of social intelligence that can be highly adaptive, counter to game theory’s predictions. His model suggests that high trusters, who take more social risks and are, therefore, more vulnerable to exploitation, obtain more differentiating social data and learn more, e.g., ‘‘Ah, this is what someone who will deceive me does.’’ In contrast, by defending themselves from possible exploitation, low trusters seem to be suspicious of everyone: They send signals that limit the development of potentially beneficial relationships and, therefore, in the absence of differentiating social data, they learn less about distinguishing trustworthy from untrustworthy others. Thus, by defending themselves from the costs associated with exploitation, low trusters can incur potentially massive opportunity costs.
…three potential adaptive explanations for a positive relationship between generalized trust and social intelligence . First, high generalized trust drives social risk taking, and the possibility of exploitation pushes high trusters to invest in learning how to identify people who are not trustworthy. Low trusters need no such skills because a social posture of defensiveness is a reliable (if costly) exploitation prophylactic. Second, advanced sensitivity to trustworthiness cues reduces a person’s vulnerability to detrimental consequences. Those who are less sensitive are better off assuming that unknown others are generally untrustworthy, leading to less generalized trust among the less socially intelligent. Assuming that people are liars prevents a person from being duped. In contrast, being effectively sensitive makes it safe to assume that others generally tell the truth because this sensitivity will help detect a lie before a person falls victim to it.

So the paper is saying that those that generally trust other people have greater social intelligence, defined as —‘‘the ability to understand own and other people’s internal state and use that understanding in social relations’’ which leads to benefits in many walks of life.

One important point is that low trusters lose out on opportunities not taken. In a business contexts this would mean missed out deals, investments and business relationships. Business is in many aspects based on trust.

To trust or not to trust

As discussed in the Issue of Trust post, the incentives for dishonesty are much stronger in a developing country like the Ivory Coast, and consequently it makes more sense to have lower trust in others.

On the other hand the benefits and opportunities from having high trust are tremendous, so when doing business in the Ivory Coast one has to handle a balancing act between trusting people, and avoiding being duped. I’d say handling of this is one of the most important factors for business success in a place like the Ivory Coast.

It would be interesting to make the  experiment of the Not Polyannas paper in the Ivory Coast. My guess is that if the high and low trust levels are redefined lower, one would get the same result, but who knows.
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