Whom do you distrust and how much does it cost? An experiment on the measurement of trust

* We address two problems with how trust is frequently measured in economics. First, we highlight the importance of clearly identifying the target of trust, which when ignored can lead to inconsistencies between trust measures. Second, we note the importance of distinguishing trust from other closely related concepts. We conduct an experiment using a new behavioral measure of trust – individuals' willingness to pay to avoid being vulnerable to the target of trust – and vary the target of trust. To test our behavioral measure, we also collect data on potentially confounding effects (i.e., altruism and risk aversion) and on attitudinal measures of trust. Subjects discriminate based on perceived characteristics of different targets in determining whether to trust, in a manner consistent with trust elicited using attitudinal measures and with actual trustworthiness. Risk aversion and altruism do not correlate highly with our measure of trust. * We gratefully acknowledge funding from a Carnegie Mellon Berkman Faculty Development Grant. Weber also gratefully acknowledges support from the National Science Foundation (SES-0433152). We also thank participants at several seminars and conferences for helpful comments and suggestions. Finally, we are also very thankful to John Hamman for valuable research assistance, the Pittsburgh Experimental Economics Laboratory (PEEL) for access to resources, and David Laibson for granting us access to his data. Finally, one of the authors would like to thank his wife, Stephanie, for valuable support and help during the completion of this project.