In “The Honest Truth about Dishonesty” , Dan Ariely’s latest foray down the behavioral economics path that looks into our irrationality, he recounts another fascinating series of experiments and lessons learnt from them. He deconstructs the simple model of rational crime as he calls it and shows how dishonest acts are not committed through a series of rational decisions. He then looks at various influencers that make one more dishonest – seeing others behave dishonestly, the “Robin Hood” factor of doing it to help others, being “ego-depleted” after a long series of tempation-resisting events, wearing fake brands, being more creative in finding excuses for it and a host of other insights. These came from experiments he did with his students and other university students, and also the studies that his collaborators did elsewhere.
Interestingly enough he observes through his studies that in those instances, the amount of money to be gained, or the probability of getting caught did not change the likelihood of people cheating in his experiment. He also talks about how one can provide timely reminders to make people more honest – making them take pledges, sign their honor codes before a test, moral reminders within their environment and being supervised being the big ones among them.
All in all, another engaging read from Dan that brings down complex human behavior and interaction issues into tractable experiments and offers interesting insights. One of the key lessons from the book was regarding the impact of dishonest acts – a disproportionately large impact came not from large acts of dishonesty by a few individuals, but small acts from a large number of people. This makes “sense” given that most of us would try to be honest for the most part but when we’re not being observed, or if we could get away with it, might be inclined to cheat in small ways.
One concern I had with these studies in general was sampling bias, and how well the students sampled represented the world population. In an interesting paper published a couple of years ago titled “The Weirdest People in the World”, Joe Henrich and and his co-authors argue that most behavioral economics experiments happen in societies that are “Western, Educated, Industrialized, Rich and Democratic (WEIRD)” and in that sense, we might in fact be sampling outliers and not a representative sample. There is an interesting summary of this at the Freakonomics blog as well.
Concerns notwithstanding, I love Dan’s work and that of his collaborators that provide very interesting insights into behavior and open up interesting questions to ponder on, on the topic of human irrationality and honesty – I’d recommend the book as a must-read!
Speaking of Dan, it is time for Startuponomics 2.0. If you want to be part of this year’s cohort, better apply soon! It was a wonderful experience to be part of the inaugural cohort last year. You can read about it from a post I did soon after that. In addition to Dan there’s an amazing array of great speakers doing pretty interesting research. I believe that startups in the valley with limited budgets for user testing and market research are uniquely positioned to test out these hypotheses in their own products or services, so this is a unique opportunity that shouldn’t be missed! Ping me if you have more questions about my experience from last year.