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Behavioural economics and corporate responsibility

Most people I meet are slowly becoming fascinated with behavioural economics.

If not the authors of ‘Nudge‘ then Tim Harford of the FT and various books, or the Freakonomics authors, or Dan Ariely.

Dan Ariely is particularly relevant. His new book “The Honest Truth About Dishonesty: How We Lie to Everyone – Especially Ourselves” is typically forthright but also rigourous.

A winning combo.

He also has a podcast series called “Arming the Donkeys” which is well worth a listen.

Ariely refers to and discusses lots of experiments, many of which could be used in business to test ethics in company cultures.

If you can do a culture audit, why not then some randomised testing to work out how you build a better culture in your company? Here’s one simple test you could adapt for your own uses.

In one test, with 15,000 responses, Ariely looked at industries most likely to confess to cheating at gold. He found that most people think they are five times less likely to cheat than others, as part of a delusion they create.

He found that advertising executives were among the most likely cheat, and admit to doing so knowingly.

Just to stop you thinking only in terms of stereotypes though, he also found law enforcement officers are likely to cheat at golf than the average.

Just goes to show that you can’t second guess research results: your own tests in your own business will be needed.

Here’s an earlier post on randomized testing that might be vaguely interesting.

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