LAUSR

We study the interpersonal trust of a population of agents, asking whether chance may decide if a population ends up with high trust or low trust. We model this by a discrete time, stochastic coordination game with pairwise interactions occurring at random in a finite population. Agents learn about the behavior of the population using a weighted average of what they have observed in past interactions. This learning rule, called an "exponential moving average," has one parameter that determines the weight of the most recent observation and may, thus, be interpreted as the agent's memory. We prove analytically that in the long run, the whole population always either trusts or doubts with the probability one. This remains true when the expectation of the dynamics would indicate otherwise. By simulation, we study the impact of the distribution of the payoff matrix and of the memory of the agents. We find that as the agent memory increases (i.e., the most recent observation weighs less), the actual dynamics increasingly resemble the expectation of the process. We conclude that it is possible that a population may converge upon high or low trust between its citizens simply by chance, though the game parameters (context of the society) may be quite telling.