TED Radio Hour
7:54 am
Fri April 27, 2012

Why Do We Cheat?

Originally published on Fri May 25, 2012 7:58 am

Part 1 of the TED Radio Hour episode Our Buggy Brain

Despite our best efforts, bad or inexplicable decisions are as inevitable as death and taxes and the grocery store running out of your favorite flavor of ice cream. They're also just as predictable. Why, for instance, are we convinced that "sizing up" at our favorite burger joint is a good idea, even when we're not that hungry? Why are our phone lists cluttered with numbers we never call?

About The Speaker

Dan Ariely, behavioral economist, has based his career on figuring out the answers to these questions, and in his bestselling book Predictably Irrational (re-released in expanded form in May 2009), he describes many unorthodox and often downright odd experiments used in the quest to answer this question.

Ariely has long been fascinated with how emotional states, moral codes and peer pressure affect our ability to make rational and often extremely important decisions in our daily lives — across a spectrum of our interests, from economic choices (how should I invest?) to personal (who should I marry?). At Duke, he's aligned with three departments (business, economics and cognitive neuroscience); he's also a visiting professor in MIT's Program in Media Arts and Sciences and a founding member of the Center for Advanced Hindsight. His hope that studying and understanding the decision-making process can help people lead better, more sensible daily lives.

Copyright 2012 National Public Radio. To see more, visit http://www.npr.org/.

Transcript

ALISON STEWART, HOST:

This is the TED RADIO HOUR from NPR. I'm Alison Stewart.

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UNIDENTIFIED MAN #1: So TED is many things. TED stands for technology, entertainment, design.

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UNIDENTIFIED MAN #2: TED all starts with the conference.

UNIDENTIFIED WOMAN #1: Where we bring in scientists, thinkers, philosophers, artists.

UNIDENTIFIED MAN #1: Politicians, musicians.

UNIDENTIFIED WOMAN #2: We collect them all, all of these really diverse speakers, at TED and we give them 18 minutes on stage to give the talk of their lives.

UNIDENTIFIED MAN #2: Big ideas that they're passionate about.

UNIDENTIFIED WOMAN #2: Then we film them, we edit them, and we post them on the web...

UNIDENTIFIED WOMAN #1: To share with the world.

UNIDENTIFIED MAN #1: The whole world.

STEWART: Here on the TED RADIO HOUR, we'll hear some of those TED Talks, and discuss some big ideas, with TED speakers and other guests. On today's show:

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UNIDENTIFIED MAN #3: Behold! The marvel of the human brain.

STEWART: Our amazing brain, a 3-pound mass that is responsible for virtually everything we do.

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UNIDENTIFIED MAN #3: The brain is your center of logic and reason. It's your brain's job to carefully weigh your options and make the most logical choice.

STEWART: So why do we lie or cheat when we know on some level it isn't an OK option? What leads us to act irrationally, and how do our brains systematically misjudge what will make us truly happy?

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UNIDENTIFIED MAN #3: Scientists...

STEWART: We've asked three TED speakers to help us explore our buggy brain and find some answers.

(SOUNDBITE OF ARCHIVE RECORDING)

DAN ARIELY: I want to talk to you today a little bit about predictable irrationality.

My name is Dan Ariely. I'm the James B. Duke professor of psychology and behavioral economics at Duke University. And my TED Talk was about how we all have the capacity to cheat just a little bit and at the same time, feel quite good about ourselves and our own morality.

STEWART: We'll speak with Dan Ariely in just a moment. Right now, let's listen to more of his 2009 TED Talk.

(SOUNDBITE OF ARCHIVE RECORDING "TED TALK")

ARIELY: So my interest in cheating started when Enron came on the scene, exploded all of a sudden, and I started thinking about what is happening here? Is it the case that there's kind of a few apples who are capable of doing these things? Or are we talking a more endemic situation; that many people are actually capable of behaving this way?

So, like we usually do, I decide to do a simple experiment. And here's how it went: If you were in the experiment, I would pass you a sheet of paper with 20 simple math problems that everybody could solve, but I wouldn't give you enough time. When the five minutes were over, I would say: Pass me the sheets of paper, and I'll pay you a dollar per question. People did this; I would pay people $4 for their task; on average, people would solve four problems.

Other people, I would tempt to cheat. I would pass the sheet of paper. When the five minutes were over, I would say, please shred the piece of paper. Put the little pieces in your pocket, or in your backpack, and tell me how many questions you got correctly. People now solved seven questions, on average.

(SOUNDBITE OF LAUGHTER)

ARIELY: Now, it wasn't as if there was a few bad apples, a few people who cheated a lot. Instead, what we saw is a lot of people who cheat a little bit.

STEWART: A lot of people who cheated a little bit. I don't know why that was funny. Everybody in the audience giggled a little bit; so did I. Did this experiment live up to your expectations, Dan?

ARIELY: Well, you know, it's kind of a disappointing result on one hand, right? The amount of people who are willing to cheat a little bit is just incredible. On the other hand, people cheat just a little bit, so the amount of people who cheat a lot is incredibly small. This is kind of trying to put the good spin on dishonesty. We've run almost 30,000 people in many of those tasks and we found basically, about 12 people who cheat a lot. And we lost maybe $150.

On the other hand, we had about 18,000 people who cheated a little bit and we lost - you know - 30, $40,000 to those little cheaters who cheat just a little bit, but there are many of them. And I think that's actually a good reflection of what's happening in society.

You know, from time to time we have big cheaters, and they create some damage to society financially. But I think that more damage is created by people who think of themselves as good people, and cheat just a little bit here and there. But because it's so prevalent, it basically creates much larger financial devastation.

STEWART: How does the ease of the cheat affect the numbers who will cheat?

ARIELY: So not that much. You know, the standard economic theory of cheating is that basically, there are three forces that determine cheating - is, how much money is in the till, right; how much can you take? What's the probability of being caught? And if you're getting caught, what kind of punishment would you get, how much time would you get in prison?

And you're supposed to do the cost benefit analysis and therefore, figure out whether you should cheat or not. But when we try to manipulate these three forces, we don't actually see much sensitivity to those things.

Instead, what we see is that it's much more debate within ourselves; that we have kind of an angel voice in our head that tells us, I don't feel so good about this, let's stop. The interesting thing, though, that this angel voice allows us to get away with a little bit of cheating.

STEWART: Let's go back to your TED Talk, where you discuss the idea of the personal fudge factor.

(SOUNDBITE OF ARCHIVE RECORDING "TED TALK")

ARIELY: At one hand, we all want to look at ourself in the mirror and feel good about ourselves, so we don't want to cheat. On the other hand, we can cheat a little bit and still feel good about ourselves. So maybe what is happening is that there's a level of cheating we can't go over, but we can still benefit from cheating at a low degree as long as it doesn't change our impressions about ourselves. We call this, like, a personal fudge factor.

Now, how would you test a personal fudge factor? Initially, we said: What can we do to shrink the fudge factor? So we got people to the lab and we said, we have two tasks for you today. First, we asked half the people to recall either 10 books they read in high school, or to recall the Ten Commandments. And then we tempted them with cheating. Turns out, the people who tried to recall the Ten Commandments - and in our sample, nobody could recall the Ten Commandments - but those people who tried to recall the Ten Commandments, given the opportunity to cheat, did not cheat at all.

It wasn't that the more religious people - the people who remembered more of the commandments - cheated less, and the less religious people - the people who couldn't remember almost any commandment - cheated more. The moment people thought about trying to to recall the Ten Commandments, they stopped cheating. In fact, even when we gave self-declared atheists the task of swearing on the Bible, and we give them a chance to cheat, they don't cheat at all.

Now, Ten Commandments is something that is hard to bring into the education system so we said, why don't we get people to sign the honor code? So we got people to sign - I understand that this short survey falls under the MIT honor code. Then they shredded it. No cheating whatsover. And this is particularly interesting because MIT doesn't have an honor code.

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STEWART: So Dan, what outside factors can help shape someone's fudge factor?

ARIELY: Yeah, so there's factors that make a fudge factor higher, and there are factors that make it lower. And if you think about it, it's basically about the ability to justify what we're doing, right? We have this incentive to be bad or to be dishonest, and the question is can we tell ourselves a story that would make it more OK?

So the things that make it go up, make the fudge factor become larger and make us more - make it easier for us to be dishonest is, for example, the fact that we see other people around us doing the same thing. Or when we're doing it for a good cause, right? It would be a bit like Robin Hood, right? We're doing it; it's immoral, yes; but we're doing it for something good.

Another thing that helps a lot to be modest, honest and feel good about it is that - when we deal with stuff that is distant from money. And this, by the way, is one of the thoughts that worries me the most, because we are moving into a cashless society, right? If you think about it, what keeps us honest is being close to cash.

What happens when we move to things like stocks or stock options or mortgage backed securities or electronic wallets? Would those mediums of storage of value allow people to be more dishonest and at the same time justify it to themselves?

STEWART: Dan, let's get back to your TED Talk.

(SOUNDBITE OF ARCHIVE RECORDING "TED TALK")

ARIELY: I did the same experiment as I described to you before. A third of the people, we passed the sheet, they gave it back to us. A third of the people, we passed it, they shredded it, they came to us and said, Mr. Experimenter, I solved X problems, give me X dollars. A third of the people, when they finished shredding the piece of paper, they came to us and said, Mr. Experimenter, I solved X problems, give me X tokens. We did not pay them with dollars. We paid them with something else, and then they took this something else; they walked 12 feet to the side and exchange it for dollars.

Think about the following intuition: How bad would you feel about taking a pencil from work home, compared to how bad would you feel about taking 10 cents from a petty cash box? These things feel very differently. Would being a step removed from cash for a few seconds, by being paid by token, make a difference? Our subjects doubled their cheating.

So what have we learned from this, about cheating? We've learned that a lot of people can cheat; they cheat just by a little bit. When we remind people about their morality, they cheat less. When we get bigger distance from cheating - from the object of money, for example - people cheat more. And when we see things of cheating around us, particularly if it's a part of our in- group, cheating goes up.

Now, if we think about this in terms of the stock market, think about what happens. What happens in a situation when you create something where you pay people a lot of money to see reality in a slightly distorted way? Would they not be able to see it this way? Of course, they would. What happened when you do other things - like, you remove things from money? You call them stock or stock option, derivatives, mortgage-backed securities. Could it be that with those more-distant things - it's not a token for one second; it's something that is many steps removed from money, for much longer time - could it be that people would cheat even more? And what happened to the social environment when people see other people behave around them? I think all of those forces worked in a very bad way in the stock market.

STEWART: The big theme of your talk is that we should challenge our intuitions; that we should think differently about cheating because the way we originally think about it, it may not be the case. You suggest that we will all do better if we test our intuitions. Why?

ARIELY: So we have very naive intuitions about our own operations and I think in cheating, as one example for this, we think very much in economic model. We think that why people cheat? Well, they cheat because they want something else. What's stopping them? The fear of getting to prison and getting punished and getting caught.

So we have this very mechanistic view of the reasons why people are doing it. And not only do we have this view, that's the view that we implement. So you say, what are the punishing policies? What are they based on? What is the educational system based on? What is the legal system based on? What are the policies that companies create? How do parents teach their kids?

All of those things are based on assumptions about what's causing misbehavior. And they're based on very, very simple assumptions. And if we have an incredibly simplistic view of human nature - which is not correct - we're not going to get to the behavior that we want. So I think in all of those cases, it behooves us to have a bit more humility, to question our assumption of human beings, and to basically try to experiment a bit more before we implement all kinds of policies.

STEWART: Dan Ariely, thanks so much for talking with us on the TED RADIO HOUR.

ARIELY: My pleasure.

STEWART: Dan Ariely's new book is called "The Honest Truth About Dishonesty: How We Lie To Everyone - Especially Ourselves". You can read more about Ariely's research, and you can watch more TED Talks about how our mind works. Go to ted.npr.org. Transcript provided by NPR, Copyright National Public Radio.