Cooperation and Shared Beliefs about Trust in the Assurance Game.

Determinants of cooperation include ingroup vs. outgroup membership, and individual traits, such as prosociality and trust. We investigated whether these factors can be overridden by beliefs about people's trust. We manipulated the information players received about each other's level of general trust, "high" or "low". These levels were either measured (Experiment 1) or just arbitrarily assigned labels (Experiment 2). Players' choices whether to cooperate or defect in a stag hunt (or an assurance game)--where it is mutually beneficial to cooperate, but costly if the partner should fail to do so--were strongly predicted by what they were told about the other player's trust label, as well as by what they were told that the other player was told about their own label. Our findings demonstrate the importance for cooperation in a risky coordination game of both first- and second-order beliefs about how much people trust each other. This supports the idea that institutions can influence cooperation simply by influencing beliefs.