Trust and Economics: The Co-evolution of Trust and Exchange Systems

147 Pages·2015·2.516 MB·English

by  Yanlong Zhang

Trust and Economics
A great deal of attention has been given recently to one of the central
paradoxes of trust: namely how people can restrict self-interest in order to
trust. Existing perspectives, theories, and models offer partial explanations,
but this volume presents a novel framework that expands on the findings of
recent studies of trust and exchange. This book offers a new angle for the
understanding of exchange and trust in an interactive context, describes
the interactive characteristics of trust in exchange systems, and develops a
theory explaining the co-evolution of trust and exchange systems.
A new framework is used to incorporate the theory of systems of trust
and evolutionary game-theoretical approach to investigate four important
questions: How can trust emerge in exchange when people pursue self-
interest? After its emergence, how does exchange affect trust in a dynamic
process? When are dynamics of trust stable? Do interactive trust phenomena
differ under different exchange systems? This book concludes with a dis-
cussion of the implications of the theoretical findings for three areas: the
improvement of trust, potential economic growth, and mechanism design
in exchange systems.
This volume makes a significant contribution to the literature on evoluti-
onary and institutional economics and is suitable for those who have an
interest in political economy, economy theory and philosophy as well as
economic psychology.
Yanlong Zhang is a Research Assistant at the Institute of Economics at
Isinghua University, China.
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Trust and Economics
The co-evolution of trust and
exchange systems
Yanlong Zhang
First published 2016
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© 2016 Yanlong Zhang
The right of Yanlong Zhang to be identified as author of this work has been
asserted by him in accordance with the Copyright, Designs and Patent Act 1988.
All rights reserved. No part of this book may be reprinted or reproduced or
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British Library Cataloguing in Publication Data
A catalogue record for this book is available from the British Library
Library of Congress Cataloging in Publication Data
Zhang, Yanlong, 1980–
Trust and economics: the co-evolution of trust and exchange systems/
Yanlong Zhang.
pages cm
1. Trust—Economic aspects. 2. Exchange. 3. Economics. I. Title.
HB72.Z4366 2015
306.3′4–dc23
2015002310
ISBN: 978-1-138-86095-7 (hbk)
ISBN: 978-1-315-71618-3 (ebk)
Typeset in Times New Roman
by Swales & Willis Ltd, Exeter, Devon, UK
To my father
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Contents
List of figures xi
List of tables xiii
Preface xiv
Acknowledgments xv
List of abbreviations xvi
1 Introduction 1
The importance of trust in exchange 2
The paradoxes of trust 3
Existing explanations 4
Research questions and framework 5
Outline of the study 6
2 Theory 13
Exchange and trust 15
Co-evolving trust and exchange systems: The implication
of a theory of the system of trust 22
3 Methodology 46
Basic concepts 47
Evolutionary modeling 50
Analysis in this study 54
4 Emergence of trust 57
Trust in behavioral interdependence 58
Trust in evolutionary interdependence 66
Summary 71