Economic Psychology

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Economic Psychology

How and why markets aren't rational. Navigational tips for charting the Bermuda Triangle of human economic behavior.

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Into the Looking Glass:
Trust, Virtual Trust, and Impostership
Once, back in the ancient past (2002), AKMA commented on Brent Glass's question as to "why the companies that vociferously demand that we trust them are themselves the least trustworthy." My response follows:

Because they are the only ones stupid enough (in the world of emotional intelligence) to believe that trust is a commodity that can be bought and sold; that trustworthiness is a pose to strike in the service of competitive advantage rather than a stance in life. In this construction, trust is a product feature that encourages customers to do what you want them to do in spite of their better judgement or economic self-interest. Paradoxically, in urging us to trust them, they reveal an utter absence of understanding of the concept. This, in turn, lets us know they are entirely untrustworthy.

Three years later, amidst all the speeches, the debates, the attempts at definition, and the caterwauling about the cost of establishing trust online, I still believe this to be true. Indeed, it appears that the most vital question of all has received little or no attention. That question is: "Are you trustworthy?"

If trust is the willingness to place oneself in a position where one is to some extent vulnerable to another (whether economically, emotionally, or physically), trustworthiness is the willingness, ability, and commitment to honor that trust, through a combination of good will, competence, and follow-through.

In any successful trusting relationship, be it commercial or personal, the risk taken by the trustor is necessarily matched by the will and ability of the trustee to deliver on the promise(s) they have made. Also inherent in any trusting relationship are an experience-based, mutual assumption of benevolence and a congruence of expectations. When these characteristics are present, risk is minimized and both parties benefit. The relationship in question could be either personal or professional, financial or emotional; the risk could be either large or small--but the equation does not vary.

The nature of the relationship notwithstanding, the 'contract' is that words and deeds will match. This is why, for instance, dramatic and sweeping commercial promises, when accompanied by lengthy, unreadably small caveats written in undecipherable legalese, engender well they should. Ultimately, exploitative aims reveal themselves in action: PR no matter how brilliant, can function only as a temporary camouflage. People can tell, instinctively, when the signs of impostership are there. Thus, David Isenberg recently asked: "Do you distrust "trusted computing" as much as I do?

Building trust is expensive. There is a good reason for this. Trust is precious. When trust is violated, the trustor typically pays a far higher price than does their MMoN (misfeasant, malfeasant, or nonfeasant) counterpart. Thus, if you or your organization are concerned with building others' trust but are not focusing with equal intensity on making sure you are trust-worthy, you are worrying about the wrong thing. This, in turn, suggests they are right to be suspicious.

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