FInancial Involvement Inhibits Trust

Homo Economicus Belief Inhibits Trust – PLoS One – 2013 Oct – Free PMC Article

As a foundational concept in economics, the homo economicus assumption regards humans as rational and self-interested actors.

In contrast, trust requires individuals to believe partners’ benevolence and unselfishness.

The present three experiments demonstrated that the direct exposure to homo economicus belief can weaken trust.  And economic situations like profit calculation can also activate individuals’ homo economicus belief and inhibit their trust.

It seems that people’s increasing homo economicus belief may serve as one cause of the worldwide decline of trust. 

Homo Economicus Belief and Trust

Homo economicus is the most important and basic humanity hypothesis of economics, especially neoclassical economics. As the founder of economics, Smith first took self-interest as the nature of humanity in 1776.

Homo economicus hypothesis assumes human behaviors are motivated by instrumental rationality and self-interest.

On the one hand, individuals make decisions not intuitively and blindly, but on the basis of the deliberate judgment and calculation of costs and benefits.

On the other hand, individuals are self-interested in interactions, and their sole objective is the maximization of self interest.

In contrast to the humanity views of homo economicus, trust means that individuals believe their partners to take their interest into account and dare to make decisions that may be exploited

General Discussion

To summarize the three experiments, the present study proposed and demonstrated that the homo economicus belief can undermine trust, and individuals’ homo economicus belief can be activated by direct learning or merely exposure to economic situations, such as profit calculation, serving as an enterprise manager, etc.

Homo economicus is the most essential humanity hypothesis of economics, thus students majoring in economics may learn and identify with the homo economicus belief which emphasizes individuals are self-interested and rational.

Researchers had revealed a negative relationship between economics learning and cooperation or trust

These results consistently showed that there is an evident tension between the homo economicus belief and pro-social behaviors, such as trust.

In Experiment 1, it is revealed that the direct and explicit contacting with homo economicus belief can reduce participants’ trust.
In daily life, however, individuals seldom contact with the assumption of homo economicus explicitly, but make cost-benefit analysis frequently in consumption, investment, as well as job selection etc. It is reasonable to believe that these situations can activate individuals’ homo economicus belief and then inhibit their trust.

Experiment 2 confirmed the destructive effect of homo economicus belief on trust by exposing participants to profit calculation condition.

In Experiment 3, participants in the economic situation showed a lower trust level than those in the noneconomic situation, whereas construal level did not affect trust. In Giacomantonio et al.’s view, construal level affected behaviors interacted with social motivations

With the establishment and development of market economy, people involve in economic activities more frequently than ever, which may change their humanity values and make them own a stronger belief of homo economicus, and thus inhibit their trust in other people.

In a society or country, when more people participate in various economic activities, a macro decline trend in social trust may emerge from individual’s fall in trust.

For example, in the past decades, China has established the system of market economy, and increasing talents with the degree of economics correlated subjects have been becoming the managers and employees of various economic departments of governments and enterprises, even common people have identified with the learned belief of homo economicus.

During the process of market economy development, the decline of trust is becoming a prominent social problem.

This is certainly true in healthcare, where it is becoming clear that financial interests are involved in every issue.