Reputation,volunteering, and trust: Minimizing reliance on taste-based explanations |
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| Affiliation: | 1. Department of Economics, Bar-Ilan University, 52900 Ramat-Gan, Israel;2. Institute for Applied Microeconomics, University of Bonn, Adenauerallee 24-42, 53113 Bonn, Germany;1. California Institute of Technology, 1200 East California Blvd, Pasadena, CA 91125, United States;2. Calgent LLC, 11011 Torreyana Road, San Diego, CA 92121, United States;1. School of Economics, Singapore Management University, 90 Stamford Road, 178903, Singapore;2. Division of Economics, School of Humanities and Social Sciences, Nanyang Technological University, 14 Nanyang Drive, 637332, Singapore;1. LEO, Université François Rabelais, Tours. 50, Avenue Jean Portalis BP 37206, Tours Cedex 03 France;2. Università di Salerno, Dipartimento di Scienze Economiche e Statistiche and CSEF, Via Giovanni Paolo II, 132, 84084 Fisciano SA, Italy;1. SIM University (UniSIM), Singapore;2. Austrian Institute of Economic Research (WIFO), Vienna, Austria |
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| Abstract: | We develop a model of public good contributions as signals of the contributor's trustworthiness, and test the predictions of this model using data on volunteering in small Swiss towns. Unlike most previous work, we avoid assuming that agents simply have a taste for prestige, and instead model the material value of a prosocial reputation. The model predicts that, specifically in small communities with low population turnover where reputation is important, volunteering will decline with age (as the end of the agent's reputational game approaches). In communities with higher turnover, this effect will not be observed. Our results support this hypothesis. The model also implies that the presence of a public good which must be provided voluntarily enhances trust in bilateral market and non-market interactions. |
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