How Honest People Cheat

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How Honest People Cheat

http://blogs.harvardbusiness.org/cs/2008/01/how_honest_people_cheat.html

8:21 AM Tuesday January 29, 2008
by Dan Ariely

Tags:Ethics

There are two basic conceptions of cheating. One holds that people are fundamentally dishonest and look actively for opportunities to cheat. A person walks by, say, a gas

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station,considers how much money is in the till, who might be around to stop the theft, and what punishment awaits him if caught (including potential time off for good behavior). On the basis of a cost-benefit calculation, the would-be thief decides whether to rob the place. The second notion is that people are basically honest. They are not out there scoping for chances to cheat, but circumstances tempt them. They "borrow" a pen from a conference, take an extra splash of soda from the soft drink dispenser, exaggerate the value of a television on a property loss statement, or falsely report a meal with Aunt Nava as a business expense (well, she did ask how work was going). How prevalent is this kind of dishonesty, and what drives it?

My fellow researchers and I tempted a few thousand "honest" people to cheat in a set of scientifically controlled experiments at Harvard Business School, MIT, Princeton, UCLA, and Yale. Participants were paid about 50 cents for each correct response to a set of 20 simple math problems that they had five minutes to complete. In control groups, the answer sheets were graded--on average, the participants correctly answered four problems. But in experimental groups, answer sheets were blindly shredded so that respondents knew that it was impossible for us to tell whether they had answered the questions correctly. In effect, participants could simply lie and receive more money than they had legitimately earned. On average, they claimed to have correctly solved two problems more than they knew they had (six rather than four). That is, given the chance, the majority of people cheated by about 50%. Viewed from a different angle, however, they lied about only two of the 16 problems they did not solve--12.5% of their cheating opportunity.

The results grew more interesting when we tried to understand the circumstances that influence the degree to which people cheat. First, we found that the risk of being caught did not change the level of dishonesty. For example, allowing participants to avoid revealing any sign of possible mischief (for example, by having complete anonymity in how much payment they took) did not affect the average level of cheating among them. Second, we found that getting people to contemplate their own standards of honesty (by recalling the Ten Commandments or signing an honor code) eliminated cheating completely. Finally, and perhaps most disturbing, we found that if payment was given in poker chips, which were exchanged for cash a few seconds later, the average level of cheating more than doubled.

These results point to a few interesting aspects of human nature. One is that most of us, when tempted, are willing to be a little dishonest, regardless of the risks. Another is that even when we have no chance of getting caught, we still don't become wild liars--our conscience imposes some limits. Finally, it's clear that we have an incredible ability to rationalize our dishonesty and that justifying it becomes substantially easier when cheating is one step removed from cash. Nonmonetary exchanges allow people greater psychological latitude to cheat--leading to crimes that go well beyond pilfered pens to backdated stock options, falsified financial reports, and crony deals. Such latitude is the force behind the Enrons of the world.

Dan Ariely is the Alfred P. Sloan Professor of Behavioral Economics at the Massachusetts Institute of Technology in Cambridge and a visiting professor at Duke University in Durham, North Carolina. He is the author of Predictably Irrational (HarperCollins, 2008).