The (True) Legacy of Two Really Existing Economic Systems

Ariely, Dan; Garcia-Rada, Ximena; Hornuf, Lars and Mann, Heather (19. June 2014): The (True) Legacy of Two Really Existing Economic Systems. Discussion Papers in Economics 2014-26

Abstract

By running an experiment among Germans collecting their passports or ID cards in the citizen centers of Berlin, we find that individuals with an East German family background cheat significantly more on an abstract task than those with a West German family background. The longer individuals were exposed to socialism, the more likely they were to cheat on our task. While it was recently argued that markets decay morals (Falk and Szech, 2013), we provide evidence that other political and economic regimes such as socialism might have an even more detrimental effect on individuals’ behavior.

• Item Type: Paper
• Keywords: Experimental economics, cheating, cross-culture study
• Faculties: Economics; Economics > Munich Discussion Papers in Economics
• Subjects: 300 Social sciences > 330 Economics
• JEL Classification: C93, D63, P51
• Language: English

References

Ai, Chunrong, Norton, Edward, 2003. Interaction terms in logit and probit models. Economics Letters 80, 123-129.

Abeler, Johannes, Becker, Anke, Falk, Armin, 2012. Truth-telling: A representative assessment, IZA Discussion Paper No. 6919.

Alesina, Alberto, Fuchs-Schündeln, Nicola, 2007. Goodbye Lenin (or not?): the effect of communism on people’s preferences. The American Economic Review 97, 1507-1528.

Ayal, Shahar, Gino, Francesca, 2011. Honest rationales for dishonest behavior. The Social Psychology of Morality: Exploring the Causes of Good and Evil. Washington, DC: American Psychological Association.

Ariely, Dan, Kamenica, Emir, Prelec, Drazen, 2008. Man’s search for meaning: The case of Legos. Journal of Economic Behavior & Organization 67, 671-677.

Brosig-Koch, Jeannette, Helbach, Christoph, Ockenfels, Axel, Weimann, Joachim, 2011. Still different after all these years: Solidarity behavior in East and West Germany. Journal of Public Economics 95, 1373-1376.

Demsetz, Harold, 1969. Information and efficiency: Another viewpoint. Journal of Law and Economics 12, 1-22.

DePaulo, Bella, Kashy, Deborah, Kirkendol, Susan, Wyer, Melissa, Epstein, Jennifer, 1996. Lying in everyday life. Journal of Personality and Social Psychology 70, 979.

Dreber, Anna, Johannesson, Magnus, 2008. Gender differences in deception. Economics Letters 99, 1197-1199.

Erat, Sanjiv, Gneezy, Uri, 2012. White lies. Management Science 58, 723-733.

Falk, Armin, Szech, Nora, 2013. Morals and markets. Science 340, 707-711.

Fischbacher Urs, Föllmi-Heusi, Franziska, 2013. Lies in disguise – An experimental study on cheating. Journal of the European Economic Association 11, 525-547.

Gino, Francesca, Ayal, Shahar, Ariely, Dan, 2009. Contagion and differentiation in unethical behavior the effect of one bad apple on the barrel. Psychological Science 20, 393-398.

Gino, Francesca, Pierce, Lamar, 2009. Dishonesty in the name of equity. Psychological Science 20, 1153-1160.

Greene, William, 2010. Testing hypotheses about interaction terms in nonlinear models. Economics Letters 107, 291-296.

Hao, Li, Houser, Daniel, 2010. Honest Lies. GMU Working Paper in Economics No. 11-16.

Hartshorne, Hugh, May, Mark, Maller, Julius, 1929. Studies in the nature of character II Studies in service and self-control. The Macmillian Company, New York.

Heineck, Guido, Süssmuth, Bernd, 2013. A different look at Lenin’s legacy: Social capital and risk taking in the two Germanies. Journal of Comparative Economics 41, 789-803.

Houser, Daniel, Vetter, Stefan, Winter, Joachim, 2012. Fairness and cheating. European Economic Review 56, 1645-1655.

Jiang, Ting, 2013. Cheating in mind games: the subtlety of rules matters. Journal of Economic Behaviour and Organization 93, 328-336

John, Leslie, Loewenstein, George, Rick, Scott, 2013. Cheating more for less: Upward social comparisons motivate the poorly compensated to cheat. Organizational Behavior and Human Decision Processes, forthcoming.

Koehler, John, 1999. Stasi: The untold story of the East German secret police. Westview Press, Boulder.

Lee, Spike, Schwarz, Norbert, 2010. Washing away postdecisional dissonance, Science 328, 709.

Mann, Heather, Garcia-Rada, Ximena, Hornuf, Lars, Tafurt, Juan, Ariely, Dan, mimeo. Cheating across cultures.

Mazar, Nina, Amir, On, Ariely, Dan, 2008. The dishonesty of honest people: A theory of selfconcept maintenance. Journal of marketing research 45, 633-644.

Ockenfels, Axel, Weimann, Joachim, 1999. Types and patterns: an experimental East–West comparison of cooperation and solidarity. Journal of Public Economics 71, 275-287.

Pfarr, Christian, Schmid, Andreas, Volker, Ulrich, 2013. You can’t always get what you want – East and West Germans’ attitudes and preferences regarding the welfare state. Available at: http://ssrn.com/abstract=2271607. Selten, Reinhard, Ockenfels, Axel, 1998. An experimental solidarity game. Journal of Economic Behavior and Organization 34, 517-539.

Torgler, Benno, 2003. Does culture matter? Tax morale in an East–West comparison. Finanzarchiv 59, 504-528.

World Values Survey Wave 6 2010-2014 Official Aggregate v.20140429. World Values Survey Association (www.worldvaluessurvey.org). Aggregate File Producer: Asep/JDS, Madrid Spain.

Yap, Andy, Wazlawek, Abbie, Lucas, Brian, Cuddy, Amy, Carney, Dana (2013) The ergonomics of dishonesty – The effect of incidental posture on stealing, cheating, and traffic violations. Psychological Science 20, 1-9.

Zhong, Chen-Bo, Liljenquist, Katie, 2006. Washing away your sins: Threatened morality and physical cleansing. Science 313, 1451-1452.