In this section of the course we're looking at confidence building, which is building trust between nations to cooperatively secure cyber space. The trust between nations really boils down to trust between people and even more so, to trust between leaders. When we talk about understanding trust between nations, we really need to start with an understanding of interpersonal trust. So in this module I'll be looking at trust, reciprocity, and cooperation between people. And looking at when social norms sort of trump self-interest. Okay, couple of things that I hope you'll get out of this module is that you'll come away with the understanding of the role that trust plays in positive reciprocity. And by that I mean the critical role that trust will play in reciprocal relationships between people that will result in positive gain for both. I also hope you understand why people adhere to reciprocity norms. I'm going to start out with a little bot exercise, if you will. Imagine I come up to you and say, you know, I might give you a chance to get some money. I'm going to offer you the chance to win some amount of money, up to $10, under a very simple set of rules. I'm going to stop a stranger, the next person that walks by on the street, for example, someone you don't know, and that person's going to play this game also. You're going to be the proposer and that person's going to be responder. I'm going to give you $10, and I'm going to tell you that you can split it however you want with the other person, okay. Yes but anywhere from zero up to $10, so whatever you want, you can split to with that person. One stipulation. You can keep the money. The stranger, the responder, gets to keep the money. And you, the proposer, gets to keep the money as long as the other person, the stranger, accepts your offer. So here's $10. Make an offer of some amount to the other person. If that person accepts your offer, you both get to keep the money. If the other person, the responder in this scenario, rejects your offer I take the $10 back and you guys get nothing. Okay? Simple game. So think about that, if I offered you that deal. What would you offer the other person? Okay, what would you as proposer offer that person? Take a second to think about that. Anything you want. And all you gotta do, you get to keep the money, free money, you don't have to do anything for it. That person just has to accept your offer. Also, let's think for another second. Now, put yourself in the responder shoes. Let's say you're stopped and this person, the other person is offering you a portion of the $10. What would you accept? What amount would you accept that they offered you? The simple experiment. You know, so it gets at social preferences. Let's think also of about the different models that we have for spending and behavior. If you look at a rational economic model of people, what should the proposer offer? When you think about it coming into the situation, you know, people are sort of at base line in terms of what they have for money, and they have the opportunity to gain. Any amount is a gain. So, if you're the proposer, what's the rational thing to do? You know, the economist would say offer $1. That's $1 more than the stranger has in his or her pocket right now. And one dollar is good. It's better than nothing. So, by offering a dollar, they should say, sure, I'll take a dollar. That's the rational thing to do. Is that what you offered. Did you offer $1? I'm going to bet not, okay. And the reason why is that, you know, there is this economic model is based sort of on a selfishness axiom, that people are always out to maximize their material gains in social interactions. They’re out to maximize their personal gain. Social preferences argues that individuals adhere to a variety of different social norms. There's fairness norms and there are reciprocity norms. Evolutionary psychologists and biologists have argued that these norms have actually evolved in our species and helped us to survive. Again, because it helps us to cooperate and bond with individuals. So the logic of the self-interest to maximizing gain would lead you to say that the rational offer is $1. From the perspective of both parties, you both come away with more money than you had before. So why not? If you offer $1 to the responder and the person rejects it, that's sort of foolish on his or her part, because they just gave up a free dollar. Well, let's look at the results of the experiment. This experiment has been used in many, many different situations. Many different countries. Different situations. Small amounts of money, large amounts of money. In the $10-experiment, which is the original one, the most common offer was $4 or $5. That violates this self interest axiom, okay? The most common offer is $4 or $5. Well, over half the responders, who were offered $1 or $2, when that did occur, rejected the offer. So people rejected free money. Think about your answer to the question and did you agree to accept $1 or $2. My guess is that most of you at least probably said I wouldn't accept any less than $3 or $4. So why is this occurring? All right, well as I mentioned before that these are sort of sharing norms if you will. I'm going to share the money I got with you even though I don't have to. This has been replicated in different cultures. The same results occur in Indonesia as in Germany, okay. The findings are the same for when large amounts of money are used, okay as well as small amounts. Okay, so we'll give you $10, or we could use what's equivalent to a week or month's wage, people still do the same thing. Roughly 40 to 50% of the honor money is offered to the stranger. Well, if you're sitting there, you might say, well, wait a second you know what, this could still be behavior, or the proposer could still be behaving out of self interest. Because I sort of know that the person might reject $1 or $2. And we'll leave aside for a second that that's violating a rational model man. But you could say, well, they're just trying to maximize their self interest because they're just making sure that their offer gets accepted. Okay. Well we can test that. Psychologists have tested that alternative explanation with a different version of the game. And that version of the game is called, The Dictator Game. Same exact thing, I stop in the street and say, here's $10, okay? Here's a stranger over there, you know what, you can decide whether you want to give this person any money or not. You can keep the $10 or you can split it with the person. Up to you. You get to keep whatever you don't give away. The dictator in this case, still gives away money. Again, free money to you, you don't have to share it, but they do. Students in the US, Europe, Japan gave away an average of $2 or 20% of the total. Okay, so not quite as generous. So there may be something to this notion that there's so little self interest in the offer they're trying to maximize the probability that the offer would be accepted so they go away with something. But even when they don't have to rely on another person to accept, they still give away about 20%. Interestingly, adults give away more than students. Maybe the students need money more so they're more likely to hang on to it. But adults are giving close to that 40% that we saw before. One exception, one study out there, German children actually gave 50%, okay. So maybe there's something in their culture to encourage equal sharing. So anyway, it does, these studies tend to show, these studies do show that people violate the selfishness axiom. As I mentioned before there's this lack of selfishness that's found in cross cultures in studies with 15 small scale societies. Tropical forests in South America, Savanna woodlands in Africa, and deserts of Mongolia. So this study, this is a fairly robust set of findings. The human studies, looking at what happens in the brain during this game. F-MRI studies, where you can put image, the different parts of the brain that are active during this game. And what the studies show, basically, is that the areas of the brain that govern you know, emotions related to self interest and gain, and those related to social interaction are firing, are active. The two areas of the brain that are active during this game are the anterior insula, this is involved in the processing of emotion, and the dorsolateral prefrontal cortex is also involved. It again reflects the competing goals of self-interest and fairness. Getting ahead, and getting along, okay? So the competition between regions of the brain trying to figure out what to do. So it's not like we don't recognize the potential for self-interest, we somehow override that.
