Trust and trustworthiness after a land restitution program: Lab-in-the-field evidence from Colombia

Year: 2019 HiCN Working Paper No. 291

We assess the impact of a governmental program to compensate victims of forced displacement on pro-social behavior. All our subjects were eligible to apply for restitution of their land in accordance with the “Bill of Victims” (Ley de Víctimas, Bill 1448/2011). The key independent variable of our analysis is whether a subject had obtained land within this or similar programs. Our dependent variables are a subject’s trust and trustworthiness to unknown others, as measured by a modified version of a Trust Game. We focus on interpersonal trust and trustworthiness because of their well-documented positive effect on economic development. Our design also included a treatment in which subjects voted on their most preferred outcomes in the Trust Game, because we wanted to understand whether forms of consultative democracy could engender higher mutual trust. We find that land restitution significantly increases trustworthiness, while there is no effect on trust. This is consistent with findings that trust and trustworthiness tap into different aspects of pro-sociality. Voting does not improve either trust or trustworthiness, but there is a positive effect once interacted with restitution.