Wednesday, July 01, 2009

Predictably Irrational

Several weeks ago, I wrote about the attempt by some Harvard Business School students to create an MBA oath akin to the professional oaths taken by doctors and lawyers. I must admit that I had my doubts regarding the efficacy of such an oath in promoting more ethical and responsible behavior on the part of business executives.

Today, I just finished reading Dan Ariely's interesting book, Predictably Irrational, while on the train from Amsterdam to Brussels (I'm teaching several executive education workshops this week in Europe through the Institute of Management Studies). Ariely is a behavioral economist, i.e. a scholar working at the intersection of psychology and economics to understand how human behavior often does not confirm to the "rational" model of choice employed by many economists.

In his book, Ariely has several chapters on the topic of honesty and cheating. He describes an interesting experiment in which he examines whether being reminded of the Ten Commandments might induce individuals to exhibit more honest behavior. In the experiment, participants were asked to solve some simple mathematics problems. The control group did not have an opportunity to cheat; they handed their answers directly to the experimenter. A second group had an opportunity to cheat; they were allowed to self-report their number of correct responses without handing in their answer sheets. Prior to taking the math test, this group was asked to write down the names of ten books that they had read in high school. Finally, a third group also had the opportunity to cheat through self-reporting, but they were asked to write down as many of the Ten Commandments as they could remember. What did Ariely find in this experiment? The second group answered more questions correctly than the control group, suggesting some cheating. However, the third group (which recalled the Ten Commandments prior to taking the test) did not answer any more problems correctly than the control group. Amazingly, many subjects could not recall all of the Ten Commandments, yet they still exhibited honesty. Simply thinking about moral standards had induced honest behavior!

Could this mean that taking a professional oath would reduce unethical behavior on the part of business executives? I'm not so sure. As Ariely points out, the key to his experiment is that the subjects were asked to think about the Ten Commandments immediately before they had an opportunity to cheat. In the case of the MBA oath, students may take it upon graduation, but the tempting situation may not occur to them for a number of years. Thus, the key to any professional oath is not simply to administer one at the start of a career, but to somehow reinforce its salience over time.

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