The long shadow of income on trustworthiness

Abstract

We employ a behavioural measure of trustworthiness obtained from an experiment carried out with a sample of the general British population whose individuals were extensively interviewed on earlier occasions. Our basic finding is that given past income, higher current income increases trustworthiness and, given current income, higher past income reduces trustworthiness. Past income determines the level of financial aspirations and whether or not these are fulfilled by the level of current income affects trustworthiness. We also suspect that past income may also capture heterogeneity in relevant subjects' dispositions, with more opportunistic subjects being less trustworthy and having higher average incomes.