The (Honest) Truth About Dishonesty: By Dan Ariely

The (Honest) Truth About Dishonesty: How We Lie to Everyone – Especially Ourselves

By Dan Ariely


A book review by Duncan Brett

  The nub of it: We are all capable of cheating and being dishonest. Whether and how much we do so depends on two conflicting influences, the benefit we can extract from cheating vs. the need to see ourselves in a positive light as good, honest people. We fudge things by telling ourselves stories so we can cheat a bit and still feel good about ourselves.

In his 3rd book, the academic behavioural economist Dan Ariely takes us on a tour of how dishonesty and cheating comes about and how it works. His book is filled with details of social experiments to illustrate effects and highly personal anecdotes. His writing style is light and easy to read, although you will need to be prepared to wade through a seemingly infinite number of permutations of the matrix experiment.

His previous books had a broader focus on how our thinking is bounded by irrationality, while this book focuses on the much narrower construct of how and why we are dishonest. This text extends on the book predictably irrational, if you are looking to start, I would read that first.

Even though the book does not talk to marketing or research directly it raises important points on human nature. One of these is that we are so easily able to convincingly fool ourselves with our own stories. Another tip from the book would be that you should get interviewers and respondents to sign off that they have answered honestly before they start the questionnaire, and not at the end.

Dishonesty is a big problem in society, (and in the market research industry too). Understanding why people cheat is important in any profession that purports to understand human nature (not to mention society at large). It is also useful to remember the propensity for many to be dishonest in little ways is much bigger and more insidious than the impact of a few outright criminals.

This book refutes the simple model of rational crime devised by rational economist Gary Becker. (Becker got the idea when he was late for a meeting and looking for parking. He considered parking illegally and weighed the costs getting a ticket vs. the benefit of getting to the meeting on time.)

Ariely tested the model with a matrix test, where people were asked to add up numbers in a matrix and got rewarded for the answers they got right. Different permutations of being able to get caught were used to test the level of cheating. This test and variants is referred to extensively throughout the book. Different permutations showed that people tended to cheat by 2 (claimed 6 correct answers vs. the control group of 4). This amount of money and probability of being caught did not seem to affect the results, which does not tie in with the rational model.

This led to the theory that we have an inbuilt conflict. We need to perceive ourselves as honest but also want to benefit from the cheating financially. This leads to us having an inbuilt fudge factor. The amount we are willing to cheat without feeling we are being dishonest. We are cognitively flexible beings. He termed the flexibility the fudge factor.

Ariely takes us through a range of different experiments that show many people are prone to cheat to the extent that they can rationalize. The typical fudge factor seems to be 10-15 percent. Removing the action a step from cash increases the propensity to cheat considerably. Thus we will take a pencil but not money. Ariely ran experiments with golfers and found similar results. Cheating decreased when we became psychologically removed from the act. Moving the ball with a club is easier than using your hand.

As we move to a cashless society, this has worrying implications.

In addition we have the ability to lie to ourselves (without even realising it) about our own dishonesty. We can rationalize it and fudge it. Being reminded of moral issues temporarily stops us from cheating, but does not seem to have a lasting effect.

An experiment showed signing an honor code immediately reduced cheating, but having an honor code signed weeks previously made no difference. Likewise signing a form saying you have filled it out honestly makes an impact if you sign before filling it out, but not at the end. Ariely suggests we would reduce cheating on taxes and insurance if we moved the signature to the front of the form.

Our own motivations can blind us, without us even realizing it. Take the example of a doctor who recommends crowns because he has bought expensive crowning equipment. An MRI experiment showed our brains are positively biased to companies giving us gifts or sponsoring us, even if the outcome is independent of the gift.

Conflicts of interest are ubiquitous and we underestimate the influence they have. They are often very difficult to recognize and not easy to remove in practice. Regulation and disclosure clauses are often thought to be the answer but experiments with financial advisors have shown that that they do not work as well as we hope. If we know the advisor has a conflict, we will discount the advice, but in reality, the advisors inflate more and consumers don’t discount enough.

When our deliberative reasoning is occupied our impulsive system gains more control over our behaviour. Temptation can wear us down, it is better to avoid than resist temptation. Ego depletion is based on the idea that resisting temptation requires effort and energy. So after a long day of resisting temptation we surrender to impulse. In effect we blow it when we get tired.

Our actions influence our propensity to cheat. Wearing fakes makes us cheat more. Ariely looked at whether there is a relationship between what we wear and how we behave. What we wear sends a signal to others (external signaling). We self signal as well though, and in self signaling we don’t know ourselves as well as we think and observe and infer on ourselves as we would with others. Ariely theorized wearing fakes could make us feel less legitimate and the tainted self-image makes us more likely to be dishonest. His experiments showed wearing a genuine product does not make us more honest, but knowingly wearing a fake loosens morals and is the 1st step down the dishonesty path. Not only does wearing fakes make us less honest, but it also makes us more suspicious of others.

He cites the “what the hell” effect that suggests we may try to be honest, but once we cheat we then say what the hell and abandon all restraint. We often see it in diets. Religious practices such as confessions allow us to reset this effect, and do work.

The combined effect of self-signaling and the what-the-hell effect means a single act of dishonesty can be quite long lasting. If we are wearing a built in reminder then the effects can be very long lasting and influential. To enable dishonesty, we cheat ourselves.

Ariely used experiments to show show we cheat a little and deceive ourselves that we are not really cheating. Self-deception is a useful strategy for believing the stories we tell and make us less likely to signal to others that we are anything other than what we say. Self deception helps us maintain a positive self image, but can make us overly optimistic. We easily believe our stories and they can become true to us, but if we are made blatantly aware of our cheating then we are less likely to believe the self-deception.

There is a link between creativity and dishonesty. “Facts are for those who lack the creativity to create their own truth” We don’t know why we choose the things we do, but this does not stop us from creating perfectly logical stories to explain our actions, we need an explanation for why things work, even if it has little bearing on reality. As humans we have a fundamental conflict. We are torn between our propensity to lie to ourselves and our desire to perceive ourselves as honest and good. So we create stories to justify to ourselves. We pull the wool over own eyes. We often make decisions based on gut feel, but then create stories to justify our decision.

Experiments with pathological liars show our brain is made of gray (thinking, processing matter) and white (wiring, connectivity) matter. Liars have less grey and more white matter. The experiment showed the difference between creative and less creative comes into play when there is ambiguity, giving room to create stories. The link between creativity and dishonesty relates to our ability to tell ourselves stories to justify our dishonesty and tell us we are doing the right thing. Annoyance and the case for revenge also play a role in justifying our dishonesty. So too, putting people into a creative mindset using priming techniques also showed to increase cheating. However intelligence does not appear to play a role.

The news seems to get worse, because not only do we have the innate capability to cheat, it can be infectious. Immorality can spread from person to person like a bug. By observing the bad behaviour of others around us, (especially when they are part of our social group) it makes dishonesty seem more acceptable. If the person is not part of our group then the cheating is harder to justify and we become more ethical. As long as we see members of our group act outside social norms we recalibrate our internal compass to fit that. The impact is amplifies if we observe an authority figure. The infection ability of dishonesty means that we need to take a different approach, since society often faces not a few bad eggs in a sea of good but many eggs that are a little bad and can infect the egg next door.

Small things can accumulate to a socially corrosive effect. Single acts can have a multiplier effect and can mutate. He reminds us of why the broken windows theory has a place (this based on a theory that stamped out vandalism that fixed things as they broke. This stopped the rot from setting in, and may be food for thought if like me, you are a reluctant handyman around the house.)

Ariely then looked at the effects of collaborative cheating. His experiments showed altruistic tendencies cause us to cheat more when our team members benefit (and even more when we don’t, bring to mind shades of Robin Hood and the fact that it is easier to rationalize) and to cheat less when we are being monitored. However when you get to know and socialize with your supervisor, altruistic cheating trumps the supervisory effect. And the people who care about their coworkers the most may cheat the most.

An interesting side note to the experiments confirmed other work to show there is no evidence to show working in groups increases performance.

The book ends on a semi optimistic note. Ariely notes the inherent conflict between wanting feel good and perceive ourselves as honest, and wanting to benefit from the cheating is rationalized by telling ourselves stories and cheating within an acceptable fudge factor.

This innate tendency is universal, although cultural context can influence the acceptability and size of the fudge factor.

One Immoral act, creativity which gives us the ability to rationalize, benefiting others, watching others cheat, a culture that allows cheating, conflicts of interest, and being depleted are all factors that all contribute to dishonesty.

Pledges, signatures, moral reminders, and being supervised were all shown to be factors which decreased dishonesty, while perhaps surprisingly, the potential benefit and probability of being caught seems to make little difference.

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