Social preferences before and after the onset of the COVID-19 pandemic in China

King King Li (1) , Ying-Yi Hong (2) , Bo Huang (2) , Tony Tam (2)

1 Shenzhen Audenica Financial Technology Institute
2 Chinese University of Hong Kong

This study compares Chinese people's trust and trustworthiness, risk attitude, and time preference before and after the onset of the COVID-19 pandemic in China. We compare the preferences of subjects in two online experiments with samples drawn from 31 provinces across mainland China before and after the onset of the pandemic. We test two competing hypotheses regarding trust and trustworthiness. On the one hand, the outbreak as a collective threat could enhance in-group cohesion and cooperation and thus increase trust and trustworthiness. On the other hand, to the extent that people expect their future income to decline, they may become more self-protective and self-controlled, and thus less trusting and trustworthy and more risk averse and patient. Comparing before and after the onset, we found that the subjects increased in trustworthiness. After the onset, trust and trustworthiness (and risk aversion and present bias too) were positively correlated with the COVID-19 prevalence rate in the provinces. Subjects with more pessimistic expectations about income change showed more risk aversion and lower discount rates, supporting the speculation concerning self-control.

Keywords: COVID-19; trust; trustworthiness; social preference; risk attitude

Domains: Humanities and Social Sciences; Economics and Finance

King King Li, Ying-Yi Hong, Bo Huang, Tony Tam. Social preferences before and after the onset of the COVID-19 pandemic in China. Judgment and Decision Making, 2022, 17 (6), pp.1313-1333. ⟨hal-03899653⟩