Trust-based implicit contracts may outperform incentives in improving efficiency.
The study challenges the traditional idea that using incentives is the best way to get someone to do a task. Instead, the researchers found that trust-based agreements can lead to better outcomes for both parties involved. Experimental subjects were able to work efficiently without needing to share risks unfairly. This suggests that focusing too much on incentives can actually harm the relationship and reduce overall efficiency. Trust may be a more effective way to achieve mutual benefits in negotiations.