| Abstract |
Despite the importance of trust in determining economic outcomes, little is known about what facilitates or hinders interpersonal trust. Using a randomized field experiment of a fundraising campaign, we examine the role of trust and the determinants of perceived trustworthiness in the context of crowdfunding. The key feature of the experiment involves randomized rotations of the campaign design, which differ in the profile photo, details of campaign description, and the update status. The perceived trustworthiness of these rotations is then independently judged by survey participants. We find that while posting updates significantly increases perceived trustworthiness of the campaign and the funds raised, having a more detailed description has little effect. Our follow-up survey reveals that the differential effects are mostly driven by information salience. Interestingly, displaying a white or male profile photo improves the trustworthiness score and generates a higher contribution level, which can be explained by white participants(and donors) and male participants (and donors) preferences. Finally, we find that effects of campaign updates and the profile photo disappear when donors are directly connected to the fundraising team, highlighting the authentication and trust-transmission role of social networks. |