Behavioural Economics – do people return found wallets?

In Science magazine last month Alain Cohn of the University of Michigan and his colleagues published some interesting research into how honest people are. He surveyed 17,000 people people in 355 cities within 40 countries. Cohn’s research assistants entered public buildings – banks, theatres, hotels, police stations, post offices and courts – and handed into an employee at the reception area a dummy wallet. They stated that they found the wallet on the street outside. Each wallet was the same:

  • see through plastic card case
  • 3 identical business cards – with a unique email address and fictitious native man’s name
  • a shopping list – in the local language
  • some had a key
  • some had cash – $94.15 in local currency – only done in 3 countries
  • some had cash – $13.45 in local currency
  • some had no cash

Once handed in the researchers waited for the email about returning the wallet. Results were as follows:

  • In 38 of the 40 countries were more likely to return wallets which had money in them. The two outlier countries were Peru and Mexico – wallets with no money were more likely to be returned than those with.
  • When they increased the amount of money in the wallets by seven times in three countries, they found the average return rate climbed by 18%
  • For wallets with money, the highest rate of reporting was in Denmark (82%) and the lowest in Peru (13%).
  • Switzerland (73%) and China (7%) had the highest and lowest rates of reporting of wallets without money.
  • New Zealand – wallets returned – 60% with no money but 80% with money

People displayed more honesty when there was more money in the wallet – with greater temptation comes greater honesty. However economists are aware of previous research that shows whilst people do care about others they care more about themselves. Researchers concluded that participants main motivation was an aversion to viewing oneself as a thief so the psychological forces cane stronger than the financial ones. People stated that:

  • Not reporting a wallet without money – not stealing
  • Not reporting a wallet with money – stealing

What about the key?
Altrusim played a secondary role in the study. The key in the wallet is of no value to the finder but wallets with keys were more likely to be returned. Switzerland was the best place to lose a wallet containing a key but with no money.

The satisfaction from doing the right thing (returning the wallet) is a powerful motivator and goes against rational economic thinking. This study shows that altruism is evident and widespread.

Source: The Economist – June 22nd 2019, The Guardian

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