Trust and trustworthiness in the villain’s dilemma: collaborative dishonesty with conflicting incentives?

Wrong-doers may try to collaborate to achieve greater gains than would be possible alone. Yet potential collaborators face two issues: they need to accurately identify other cheaters and trust that their collaborators do not betray them when the opportunity arises. These concerns may be in tension, since the people who are genuine cheaters could also be the likeliest to be untrustworthy. We formalise this interaction in the “villain’s dilemma” and use it in a laboratory experiment to study three questions: what kind of information helps people to overcome the villain’s dilemma? Does the villain’s dilemma promote or hamper cheating relative to individual settings? Who participates in the villain’s dilemma and who is a trustworthy collaborative cheater? We find that information has important consequences for behaviour in the villain’s dilemma. Public information about actions is important for supporting collaborative dishonesty, while more limited sources of information lead to back-stabbing and poor collaboration. We also find that the level of information, role of the decision maker, and round of the experiment affect whether dishonesty is higher or lower in the villain’s dilemma than in our individual honesty settings. Finally, individual factors are generally unrelated to collaborating but individual dishonesty predicts untrustworthiness as a collaborator.