Truth, Lies and Gossip

Abstract

It is widely assumed that people will share inaccurate gossip for their own selfish purposes. This assumption, if true, presents a challenge to the growing body of work that argues that gossip is a ready source of accurate reputational information and therefore is welfare improving. We test this inaccuracy assumption by examining the frequency and form of spontaneous lies shared between gossiping members of networks playing a series of one-shot trust games (N=320). We manipulate whether gossipers are or are not competing with each other. We show that lies make up a sizeable minority of messages, and are twice as frequent under gossiper competition. However, this has no discernible effect on trust levels. We attribute this to the finding that, one, gossip targets are insensitive to lies, and two, some lies are welfare enhancing. These findings suggest that lies need not prevent — and may help — gossip to serve reputational functions.