The Emergence of Exchange Structures: An Experimental Study of Uncertainty, Commitment, and Trust

Abstract

An experiment is used to investigate the effects of uncertainty on pattern of exchange. The role of reputation as an important factor related to the formation of stable exchange relations is examined. In addition, some of the consequences of differences patterns of exchange-in particular, how different exchange conditions lead to different levels of trust among trading partners-are investigated. The results of the experiment indicate significant differences in the level of commitment, concern for one's own and others' reputation, and the level of trust that emerge when uncertainty (in the form of information asymmetries) is varied.