Panel Paper:
The Impact of Violence on Individual Trust, Trustworthiness and Risk Preferences: Experimental Evidence from a Set of Field Experiments in Poor Urban Areas of Honduras
*Names in bold indicate Presenter
Research-in-Progress
Douglas Montoya
Karlsruhe Institute of Technology
douglas.montoya@kit.edu
ABSTRACT. Honduras is a developing country with half of its population living in extreme poverty and the highest homicide rate in the world. The staggering level of violence may impede further development in the country. Violence can hold back social development as it erodes trust and trustworthiness among social networks, which in lower cooperation and exchange. Moreover, exposure to violence can hamper economic development by shifting individual risk preferences, which in turn can affect saving and investment decisions—drivers of economic growth—in the population.
To assess the extent to which violence has an impact on trust, trustworthiness and risk preferences, a set of monetary incentivized and randomized field experiments will be conducted across the high-risk slum areas „Bordos“ in the city of San Pedro Sula.
To the best of my knowledge, experimental economic research on this effect, particularly in the marginal urban areas where most of the violence concentrates, has not yet been conducted.
