nhaliday + judgement + empirical + demographics   2

The Determinants of Trust
Both individual experiences and community characteristics influence how much people trust each other. Using data drawn from US localities we find that the strongest factors that reduce trust are: i) a recent history of traumatic experiences, even though the passage of time reduces this effect fairly rapidly; ii) belonging to a group that historically felt discriminated against, such as minorities (black in particular) and, to a lesser extent, women; iii) being economically unsuccessful in terms of income and education; iv) living in a racially mixed community and/or in one with a high degree of income disparity. Religious beliefs and ethnic origins do not significantly affect trust. The latter result may be an indication that the American melting pot at least up to a point works, in terms of homogenizing attitudes of different cultures, even though racial cleavages leading to low trust are still quite high.

Understanding Trust: http://www.nber.org/papers/w13387
In this paper we resolve this puzzle by recognizing that trust has two components: a belief-based one and a preference based one. While the sender's behavior reflects both, we show that WVS-like measures capture mostly the belief-based component, while questions on past trusting behavior are better at capturing the preference component of trust.

MEASURING TRUST: http://scholar.harvard.edu/files/laibson/files/measuring_trust.pdf
We combine two experiments and a survey to measure trust and trustworthiness— two key components of social capital. Standard attitudinal survey questions about trust predict trustworthy behavior in our experiments much better than they predict trusting behavior. Trusting behavior in the experiments is predicted by past trusting behavior outside of the experiments. When individuals are closer socially, both trust and trustworthiness rise. Trustworthiness declines when partners are of different races or nationalities. High status individuals are able to elicit more trustworthiness in others.

What is Social Capital? The Determinants of Trust and Trustworthiness: http://www.nber.org/papers/w7216
Using a sample of Harvard undergraduates, we analyze trust and social capital in two experiments. Trusting behavior and trustworthiness rise with social connection; differences in race and nationality reduce the level of trustworthiness. Certain individuals appear to be persistently more trusting, but these people do not say they are more trusting in surveys. Survey questions about trust predict trustworthiness not trust. Only children are less trustworthy. People behave in a more trustworthy manner towards higher status individuals, and therefore status increases earnings in the experiment. As such, high status persons can be said to have more social capital.

Trust and Cheating: http://www.nber.org/papers/w18509
We find that: i) both parties to a trust exchange have implicit notions of what constitutes cheating even in a context without promises or messages; ii) these notions are not unique - the vast majority of senders would feel cheated by a negative return on their trust/investment, whereas a sizable minority defines cheating according to an equal split rule; iii) these implicit notions affect the behavior of both sides to the exchange in terms of whether to trust or cheat and to what extent. Finally, we show that individual's notions of what constitutes cheating can be traced back to two classes of values instilled by parents: cooperative and competitive. The first class of values tends to soften the notion while the other tightens it.

Nationalism and Ethnic-Based Trust: Evidence from an African Border Region: https://u.osu.edu/robinson.1012/files/2015/12/Robinson_NationalismTrust-1q3q9u1.pdf
These results offer microlevel evidence that a strong and salient national identity can diminish ethnic barriers to trust in diverse societies.

One Team, One Nation: Football, Ethnic Identity, and Conflict in Africa: http://conference.nber.org/confer//2017/SI2017/DEV/Durante_Depetris-Chauvin.pdf
Do collective experiences that prime sentiments of national unity reduce interethnic tensions and conflict? We examine this question by looking at the impact of national football teams’ victories in sub-Saharan Africa. Combining individual survey data with information on over 70 official matches played between 2000 and 2015, we find that individuals interviewed in the days after a victory of their country’s national team are less likely to report a strong sense of ethnic identity and more likely to trust people of other ethnicities than those interviewed just before. The effect is sizable and robust and is not explained by generic euphoria or optimism. Crucially, national victories do not only affect attitudes but also reduce violence. Indeed, using plausibly exogenous variation from close qualifications to the Africa Cup of Nations, we find that countries that (barely) qualified experience significantly less conflict in the following six months than countries that (barely) did not. Our findings indicate that, even where ethnic tensions have deep historical roots, patriotic shocks can reduce inter-ethnic tensions and have a tangible impact on conflict.

Why Does Ethnic Diversity Undermine Public Goods Provision?: http://www.columbia.edu/~mh2245/papers1/HHPW.pdf
We identify three families of mechanisms that link diversity to public goods provision—–what we term “preferences,” “technology,” and “strategy selection” mechanisms—–and run a series of experimental games that permit us to compare the explanatory power of distinct mechanisms within each of these three families. Results from games conducted with a random sample of 300 subjects from a slum neighborhood of Kampala, Uganda, suggest that successful public goods provision in homogenous ethnic communities can be attributed to a strategy selection mechanism: in similar settings, co-ethnics play cooperative equilibria, whereas non-co-ethnics do not. In addition, we find evidence for a technology mechanism: co-ethnics are more closely linked on social networks and thus plausibly better able to support cooperation through the threat of social sanction. We find no evidence for prominent preference mechanisms that emphasize the commonality of tastes within ethnic groups or a greater degree of altruism toward co-ethnics, and only weak evidence for technology mechanisms that focus on the impact of shared ethnicity on the productivity of teams.

does it generalize to first world?

Higher Intelligence Groups Have Higher Cooperation Rates in the Repeated Prisoner's Dilemma: https://ideas.repec.org/p/iza/izadps/dp8499.html
The initial cooperation rates are similar, it increases in the groups with higher intelligence to reach almost full cooperation, while declining in the groups with lower intelligence. The difference is produced by the cumulation of small but persistent differences in the response to past cooperation of the partner. In higher intelligence subjects, cooperation after the initial stages is immediate and becomes the default mode, defection instead requires more time. For lower intelligence groups this difference is absent. Cooperation of higher intelligence subjects is payoff sensitive, thus not automatic: in a treatment with lower continuation probability there is no difference between different intelligence groups

Why societies cooperate: https://voxeu.org/article/why-societies-cooperate
Three attributes are often suggested to generate cooperative behaviour – a good heart, good norms, and intelligence. This column reports the results of a laboratory experiment in which groups of players benefited from learning to cooperate. It finds overwhelming support for the idea that intelligence is the primary condition for a socially cohesive, cooperative society. Warm feelings towards others and good norms have only a small and transitory effect.

individual payoff, etc.:

Trust, Values and False Consensus: http://www.nber.org/papers/w18460
Trust beliefs are heterogeneous across individuals and, at the same time, persistent across generations. We investigate one mechanism yielding these dual patterns: false consensus. In the context of a trust game experiment, we show that individuals extrapolate from their own type when forming trust beliefs about the same pool of potential partners - i.e., more (less) trustworthy individuals form more optimistic (pessimistic) trust beliefs - and that this tendency continues to color trust beliefs after several rounds of game-play. Moreover, we show that one's own type/trustworthiness can be traced back to the values parents transmit to their children during their upbringing. In a second closely-related experiment, we show the economic impact of mis-calibrated trust beliefs stemming from false consensus. Miscalibrated beliefs lower participants' experimental trust game earnings by about 20 percent on average.

The Right Amount of Trust: http://www.nber.org/papers/w15344
We investigate the relationship between individual trust and individual economic performance. We find that individual income is hump-shaped in a measure of intensity of trust beliefs. Our interpretation is that highly trusting individuals tend to assume too much social risk and to be cheated more often, ultimately performing less well than those with a belief close to the mean trustworthiness of the population. On the other hand, individuals with overly pessimistic beliefs avoid being cheated, but give up profitable opportunities, therefore underperforming. The cost of either too much or too little trust is comparable to the income lost by forgoing college.

...

This framework allows us to show that income-maximizing trust typically exceeds the trust level of the average person as well as to estimate the distribution of income lost to trust mistakes. We find that although a majority of individuals has well calibrated beliefs, a non-trivial proportion of the population (10%) has trust beliefs sufficiently poorly calibrated to lower income by more than 13%.

Do Trust and … [more]
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august 2017 by nhaliday
Logic | West Hunter
All the time I hear some public figure saying that if we ban or allow X, then logically we have to ban or allow Y, even though there are obvious practical reasons for X and obvious practical reasons against Y.

No, we don’t.

http://www.amnation.com/vfr/archives/005864.html
http://www.amnation.com/vfr/archives/002053.html

compare: https://pinboard.in/u:nhaliday/b:190b299cf04a

Small Change Good, Big Change Bad?: https://www.overcomingbias.com/2018/02/small-change-good-big-change-bad.html
And on reflection it occurs to me that this is actually THE standard debate about change: some see small changes and either like them or aren’t bothered enough to advocate what it would take to reverse them, while others imagine such trends continuing long enough to result in very large and disturbing changes, and then suggest stronger responses.

For example, on increased immigration some point to the many concrete benefits immigrants now provide. Others imagine that large cumulative immigration eventually results in big changes in culture and political equilibria. On fertility, some wonder if civilization can survive in the long run with declining population, while others point out that population should rise for many decades, and few endorse the policies needed to greatly increase fertility. On genetic modification of humans, some ask why not let doctors correct obvious defects, while others imagine parents eventually editing kid genes mainly to max kid career potential. On oil some say that we should start preparing for the fact that we will eventually run out, while others say that we keep finding new reserves to replace the ones we use.

...

If we consider any parameter, such as typical degree of mind wandering, we are unlikely to see the current value as exactly optimal. So if we give people the benefit of the doubt to make local changes in their interest, we may accept that this may result in a recent net total change we don’t like. We may figure this is the price we pay to get other things we value more, and we we know that it can be very expensive to limit choices severely.

But even though we don’t see the current value as optimal, we also usually see the optimal value as not terribly far from the current value. So if we can imagine current changes as part of a long term trend that eventually produces very large changes, we can become more alarmed and willing to restrict current changes. The key question is: when is that a reasonable response?

First, big concerns about big long term changes only make sense if one actually cares a lot about the long run. Given the usual high rates of return on investment, it is cheap to buy influence on the long term, compared to influence on the short term. Yet few actually devote much of their income to long term investments. This raises doubts about the sincerity of expressed long term concerns.

Second, in our simplest models of the world good local choices also produce good long term choices. So if we presume good local choices, bad long term outcomes require non-simple elements, such as coordination, commitment, or myopia problems. Of course many such problems do exist. Even so, someone who claims to see a long term problem should be expected to identify specifically which such complexities they see at play. It shouldn’t be sufficient to just point to the possibility of such problems.

...

Fourth, many more processes and factors limit big changes, compared to small changes. For example, in software small changes are often trivial, while larger changes are nearly impossible, at least without starting again from scratch. Similarly, modest changes in mind wandering can be accomplished with minor attitude and habit changes, while extreme changes may require big brain restructuring, which is much harder because brains are complex and opaque. Recent changes in market structure may reduce the number of firms in each industry, but that doesn’t make it remotely plausible that one firm will eventually take over the entire economy. Projections of small changes into large changes need to consider the possibility of many such factors limiting large changes.

Fifth, while it can be reasonably safe to identify short term changes empirically, the longer term a forecast the more one needs to rely on theory, and the more different areas of expertise one must consider when constructing a relevant model of the situation. Beware a mere empirical projection into the long run, or a theory-based projection that relies on theories in only one area.

We should very much be open to the possibility of big bad long term changes, even in areas where we are okay with short term changes, or at least reluctant to sufficiently resist them. But we should also try to hold those who argue for the existence of such problems to relatively high standards. Their analysis should be about future times that we actually care about, and can at least roughly foresee. It should be based on our best theories of relevant subjects, and it should consider the possibility of factors that limit larger changes.

And instead of suggesting big ways to counter short term changes that might lead to long term problems, it is often better to identify markers to warn of larger problems. Then instead of acting in big ways now, we can make sure to track these warning markers, and ready ourselves to act more strongly if they appear.

Growth Is Change. So Is Death.: https://www.overcomingbias.com/2018/03/growth-is-change-so-is-death.html
I see the same pattern when people consider long term futures. People can be quite philosophical about the extinction of humanity, as long as this is due to natural causes. Every species dies; why should humans be different? And few get bothered by humans making modest small-scale short-term modifications to their own lives or environment. We are mostly okay with people using umbrellas when it rains, moving to new towns to take new jobs, etc., digging a flood ditch after our yard floods, and so on. And the net social effect of many small changes is technological progress, economic growth, new fashions, and new social attitudes, all of which we tend to endorse in the short run.

Even regarding big human-caused changes, most don’t worry if changes happen far enough in the future. Few actually care much about the future past the lives of people they’ll meet in their own life. But for changes that happen within someone’s time horizon of caring, the bigger that changes get, and the longer they are expected to last, the more that people worry. And when we get to huge changes, such as taking apart the sun, a population of trillions, lifetimes of millennia, massive genetic modification of humans, robots replacing people, a complete loss of privacy, or revolutions in social attitudes, few are blasé, and most are quite wary.

This differing attitude regarding small local changes versus large global changes makes sense for parameters that tend to revert back to a mean. Extreme values then do justify extra caution, while changes within the usual range don’t merit much notice, and can be safely left to local choice. But many parameters of our world do not mostly revert back to a mean. They drift long distances over long times, in hard to predict ways that can be reasonably modeled as a basic trend plus a random walk.

This different attitude can also make sense for parameters that have two or more very different causes of change, one which creates frequent small changes, and another which creates rare huge changes. (Or perhaps a continuum between such extremes.) If larger sudden changes tend to cause more problems, it can make sense to be more wary of them. However, for most parameters most change results from many small changes, and even then many are quite wary of this accumulating into big change.

For people with a sharp time horizon of caring, they should be more wary of long-drifting parameters the larger the changes that would happen within their horizon time. This perspective predicts that the people who are most wary of big future changes are those with the longest time horizons, and who more expect lumpier change processes. This prediction doesn’t seem to fit well with my experience, however.

Those who most worry about big long term changes usually seem okay with small short term changes. Even when they accept that most change is small and that it accumulates into big change. This seems incoherent to me. It seems like many other near versus far incoherences, like expecting things to be simpler when you are far away from them, and more complex when you are closer. You should either become more wary of short term changes, knowing that this is how big longer term change happens, or you should be more okay with big long term change, seeing that as the legitimate result of the small short term changes you accept.

https://www.overcomingbias.com/2018/03/growth-is-change-so-is-death.html#comment-3794966996
The point here is the gradual shifts of in-group beliefs are both natural and no big deal. Humans are built to readily do this, and forget they do this. But ultimately it is not a worry or concern.

But radical shifts that are big, whether near or far, portend strife and conflict. Either between groups or within them. If the shift is big enough, our intuition tells us our in-group will be in a fight. Alarms go off.
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may 2017 by nhaliday

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