The individual willingness to trust is compared to the inclination to take lottery risk in six distinct scenarios, controlling the return distributions. Trust responds to changes in the admissible return levels, but exhibits significantly smaller responsiveness to return expectations compared to parallel risk-taking. Paired comparisons suggest that the investors sacrifice 5% of the expected payoff to trust anonymous responders. Trust is more calculated and volatile for males, while appearing relatively stable for females. The results connect with evidence regarding physiological differences between trust and risk-taking, and in addition suggest that trust is more of a distinctive trait for females compared to males. The paper broadly discusses the results and their implications, connecting to diverse streams in the trust literature.
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© 2023 Peter Ping Li.