Infinite repetition sustains honest exchange without any binding commitment

Evidence

Trust is often achieved simply by the continuity of the relation between parties and the recognition by each that what he might gain by cheating in a given instance is outweighed by the value of the tradition of trust that makes possible a long sequence of future agreement. By the same token, “trust” may be achieved for a single discontinuous instance, if it can be divided into a succession of increments. — Thomas C. Schelling, The Strategy of Conflict, 311 (#expands, via linked claim)

Categorization

• XREF: connects to: Markets can organize exchange without requiring high levels of trust; Rational backward induction alone can void all mutually beneficial exchange.; Mutual trust in iterated exchange is selffulfilling through aligned incentives (+4 more)

Related

• Repeated interaction transforms the incentives of a one-way trust game (similarity 0.92)
• Repeated-interaction gains let trust outweigh distrust despite occasional great losses (similarity 0.91)
• Cost-driven market ties evolve into trust-laden partnerships over time (similarity 0.89)
• Reciprocity motivations can be self-reinforcing where further interactions are plentiful (similarity 0.86)
• Trust requires time for repeated interactions and is a cognitive capacity (similarity 0.85)
• Optimism about others’ trustworthiness is self-reinforcing through gained experience (similarity 0.83)
• Future gains from continued interaction function as both incentive and sanction for trust. (similarity 0.83)
• Trustworthiness persists only while future gains from the relationship outweigh defection (similarity 0.82)
• Trust is encapsulated interest achievable through many incentive mechanisms (similarity 0.81)
• Individual-level rational-choice accounts of trust fail as general explanations (similarity 0.81)
• Frequent repeated interaction makes cooperative trade equilibria feasible, whereas infrequent trade does not. (similarity 0.80)
• Trustworthiness begets trust via reputation and repeated dealings (similarity 0.80)
• Rational backward induction alone can void all mutually beneficial exchange. (similarity 0.80)
• Building stable relations generates the incentives that produce trust (similarity 0.80)
• Small incremental betrayals only matter when repetition accumulates into a changed final state (similarity 0.79)

Broader Connections

• Repeated interaction transforms the incentives of a one-way trust game #corroborates (0.92)
• Mutual trust in iterated exchange is selffulfilling through aligned incentives #expands (0.90)
• Repeated-interaction gains let trust outweigh distrust despite occasional great losses #expands (0.82) — Thomas C. Schelling, The Strategy of Conflict, 311