Is financial dishonesty a rational decision

Abstract

A field experiment was conducted to test the theory that financial dishonesty is a rational decision in which the likelihood of being dishonest increases with the utility of dishonesty and decreases with its cost. People in the streets of Cambridge, England, were given an opportunity to dishonestly accept a coin from an experimenter under two conditions of utility (low or high) and two conditions of cost (low or high). Utility was varied by the value of the coin, and cost was varied by the experimenter's statement. Thirty-one of the 84 subjects falsely claimed the coin. In agreement with the prediction, more dishonesty occurred in the low cost condition, but, contrary to expectations, the utility manipulation had no overall effect on dishonesty. Cost and sex of experimenter interacted significantly, in that the cost manipulation affected dishonesty only with the male experimenter. It was also found that high utility tended to produce greater dishonesty in the low cost condition than in the high cost condition.