Final answer:
The type of trust that is formed by knowing that the other person is acting in his or her own self-interest is called rational self-interest trust. This trust acknowledges that individuals may focus on their self-interest.
Step-by-step explanation:
The type of trust that is formed by knowing that the other person is acting in his or her own self-interest is called rational self-interest trust.
Rational self-interest trust is based on the understanding that people prioritize their own self-interest but also recognize that others do the same. It acknowledges that individuals may focus on their self-interest in economic decisions, but can also set it aside in other parts of life, such as volunteering or helping others.
For example, when you negotiate to buy a car, you are primarily focused on your own self-interest to get the best deal possible. However, when you volunteer at a local library, you are setting aside your self-interest to help others. Rational self-interest trust recognizes that individuals can act in their own self-interest while also considering the interests of others in different contexts.
This concept acknowledges that people often operate out of self-interest, but this does not preclude behaviors that benefit others. For example, in economic interactions, someone may pursue their own interests, like when they negotiate a raise, but they might also engage in altruistic activities like volunteering, which build social capital and indirectly serve their own interests as well.