Does Prior Experience Reduce the Ability of Cooperation-Inducing Controls to Develop Trust between Employees?

Research suggests that controls that induce cooperation can increase interemployee trust. We find that when employees have experience working with the same coworker on the same task (“case-specific experience”) prior to working under the control, controls increase trust, but to a lesser extent than when employees have no experience prior to working under the control. We also find that trust is lower when employees have case-specific experience than when they have experience with only the coworker or the task, but that neither of these forms of experience mitigates the positive effect of controls on trust. Further, we shed light on the mechanisms through which controls and experience affect trust development by providing evidence that case-specific experience mitigates employees’ tendency to neglect base rate information about cooperation and to misattribute coworkers’ behavior to their trustworthiness rather than the control. Data Availability: Data are available from the authors upon request. JEL Classifications: M41; M52; D91.