People are more likely to return wallets with large amount than ones with no money, finds a study conducted in 355 cities spread across 40 countries. (Photo: Getty Images)

Last week a senior colleague in our newsroom informed us that someone working with our sister organisation, Aaj Tak, recently found a wallet with Rs 10,000 (nearly $143) in it. He said upon finding the wallet, the person informed the police about it and handed it over to them. No doubt he is an honest person.

But when we received this information, the immediate reaction among the team ranged from complete surprise and disbelief to 'Oh! A good chap', 'what a simpleton fellow', and of course 'I wish I'd found the wallet'.

Finding wallets is not uncommon. But finding ones containing Rs 10,000 surely happens few and far between. Seeing someone return a wallet with such amount is even rarer.

The popular perception is that greater the amount of money inside a lost and found wallet, higher is its probability of not being returned.

Agree?

Well, if you do, then perhaps you should reconsider your thoughts.

A recent study conducted by behavioural economists has found that people are more likely to return wallets that contain a large amount of money than wallets with a lesser amount or no money at all. The study also found that 51 per cent of people are likely to return a wallet that had money in it while only 40 per cent would return it if it had no money.

For this study, economists at the Universities of Zurich, Michigan and Utah conducted more than 17,000 field experiments in 355 cities spread across 40 countries. The aim was to understand factors that influence civic honesty and answer questions like: Are humans inherently dishonest and self-serving?

The researchers visited 355 cities in 40 countries and carried out roughly 400 experiments in each country. These experiments were held in five to eight of the largest cities of each country.

The study, titled 'Civic honesty around the globe', was published on June 20 in Science, a highly acclaimed international journal of scientific research.

In it, the researchers examined how people behave when they find themselves positioned in a conflict between honesty and self-interest. What are the factors that influence people's decisions? The researchers also studied how people's honesty is influenced by monetary incentives for being dishonest i.e. keeping the wallet and the money in it.

WHAT DID THE RESEARCHERS DO?

For the purpose of the study, the team used 17,303 wallets as props. To understand people's honesty and how monetary incentives (for being dishonest) affect it, the team kept different amounts of money in the wallets. These wallets were primarily of three types: with no money, with some money and with a large amount of money.

The researchers visited 355 cities in 40 countries and carried out roughly 400 experiments in each country. These experiments were held in five to eight of the largest cities of each country.

What was inside these wallets?

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The wallets were transparent so that the person coming across them could see what was inside without needing to open them. Some wallets had no money while others were filed with $13.45. To increase the incentive, the researchers used local currencies.

A sample wallet used by the researchers. (Photos: Associated Press)

"For comparability across countries, we adjusted the amount according to each country's purchasing power," the study said.

What this means is that the amount of money placed inside the wallets in a country was approximately equal to the purchasing power of the local currency vis-a-vis $13.45. For example, in India this amount was Rs 230 while in Indonesia it was 51,300 Indonesia rupiah.

Besides the cash, the wallets also had three identical cards, a grocery list and a key. "The business cards displayed the owner's name and email address, and we used fictitious but commonplace male names for each country. Both the grocery list and business cards were written in the country's local language to signal that the owner was a local resident," the researchers wrote in their paper.

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Five types of institutions were chosen for the study: (1) banks, (2) hotels, (3) theatres, museums or other cultural establishments, (4) post offices, and (5) police stations, courts or other public offices.

Once on ground, team members would take a wallet and hand it over to a person attending the front desk/reception at these institutions. The team member would say: "Hi, I found this [pointing to the wallet] on the street around the corner."

After this the team member would place the wallet on the counter so that the person attending the reception desk could see it (and the money inside) before pushing it over to the employee.

"Somebody must have lost it. I'm in a hurry and have to go. Can you please take care of it?" the research team member would say before leaving the building without leaving any contact details or asking for a receipt.

"This interaction was designed to minimize recipients' concerns about being punished, since there was no written proof that a wallet had been turned in. Furthermore, by telling recipients that the wallet was found outside the building around the corner, we avoided possible concerns that the owner might come back and look for the wallet in that exact location," the study says.

The authors explain that what they wanted to basically observe was whether those who were given the wallets contacted the owner to return them or not.

To track this, a unique email address was created for each wallet. The team recorded emails that were sent within 100 days of dropping a wallet off.

WHAT WAS THE RESULT?

The study found that people across countries were "overwhelmingly" more likely to report lost wallets that had money in them than those without. "We observed this pattern in 38 out of our 40 countries," the researchers said.

They observed that on an average, when money is added to an empty wallet, chances of it being reported as found increased from 40 per cent to 51 per cent.

People in Switzerland were found to be the most honest in returning wallets. The study found that nearly 75 per cent empty wallets and 80 per cent wallets with money were reported as found in Switzerland. Switzerland was followed by Norway, Netherlands and Denmark in the honesty rankings. (See figure below.)

Source: Science

China was found to be the most dishonest country with less than 10 per cent empty wallets being reported as found. For wallets with money, the figure was about 20 per cent.

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In India, the experiments were conducted in New Delhi, Mumbai, Kolkata, Ahmedabad, Jaipur, Hyderabad, Bengaluru and Coimbatore. Researchers found that nearly 20 per cent people who found the empty wallets contacted the owners. This figure increased to nearly 45 per cent in case of wallets with money.

STRONGER EVIDENCE THAT MOST PEOPLE ARE HONEST

It is possible that you are not convinced with the findings of this study. That's okay.

You may argue the amount of money in the wallets was too little or that it is quite possible that those who contacted the owners would keep the money and return an empty wallet.

The researchers too had these doubts. So they further investigated people's behaviour. This time they used wallets with $94.15 (around Rs 6,533) i.e. seven times the amount used in the original study. These 'big money experiments' were carried out in three countries--the US, Poland and the UK.

The result showed that reporting rates for lost wallets increased in all three countries. On an average, the response rates in the three countries was 46 per cent in the 'NoMoney condition', 61 per cent in 'Money condition', and topped out at 72 per cent in the 'BigMoney condition' (see figure below).

Source: Science

This bolstered the argument that most people are honest and likely to return wallets with large amounts of money in them.

In the second study, researchers also asked people who had chosen to return the wallets, the amount of reward money they expected for their act. The researchers note: "We fail to find evidence that people expect a larger reward for returning a wallet with more, rather than less, money." The researchers say this suggests that people are genuinely honest and the expectation of getting a handsome reward for reporting a lost wallet isn't a prime motivator for them.

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Besides this, the study also examined if people who contacted wallet owners were likely to keep the money and return an empty wallet. To check this, two countries were identified -- Switzerland and the Czech Republic. (Switzerland is one of the cleanest countries in terms of prevalence of corruption while the Czech Republic fares relatively poor. Check their Transparency International rankings for 2018 here.)

We mistakenly assume that our fellow human beings are selfish. In reality, their self-image as an honest person is more important to them than a short-term monetary gain. - Alain Cohn, co-author of study, assistant professor of economics at the University of Michigan

In these two countries, the researchers contacted those who tried to contact the wallet owners and collected the so-called lost wallets. It was found that in 98 per cent of the cases (99 per cent in Switzerland and 97 per cent in the Czech Republic) people returned the wallets with the amount of money intact.

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One final aspect that the study examined was how concerned are people about the loss of others. For this, the researchers carried out another set of experiments in the US, the UK and Poland. This time, the researchers used two kinds of wallets: One that had money as well as a key and another that had money but no key.

The reason to exclude key in the second wallet was that while money is valuable for both the wallet owner and the person who finds it, a key has value only for the person who loses it.

The study found that on an average, people were 9.2 percentage points more likely to report a wallet with a key than one without.

CHALLENGING OLD THEORIES, ATTEMPTING NEW ANSWERS

This research was conducted against the backdrop of prevailing theoretical assumptions on honesty such as:

1. People's honest behaviour will become rarer when material incentives for dishonesty increase. In other words, honesty becomes less common when people see they can benefit from doing something dishonest.

2. At times, people's behaviour is also driven by altruistic concerns. The study says theories on altruistic behaviour or other-regarding preferences also predict that people care about others but they will become dishonest as incentives for dishonesty increase. This is because individuals' self-interest almost always overshadows concerns for others. "We care about others but not as much as we care about ourselves," the study said while referring to theories on honesty that take altruism into consideration.

3. The third theoretical line says people will cheat for profit only as long as doing it does not require them to correct their self-image i.e. overcome the guilt of knowing they have done something wrong. But it is unclear to what degree would these individuals refrain from being dishonest when incentives for dishonesty are considerably increased.

However, behavioural economists who conducted this study in 355 cities spread over 40 countries argue that people inherently are honest by nature.

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"We mistakenly assume that our fellow human beings are selfish. In reality, their self-image as an honest person is more important to them than a short-term monetary gain," says Alain Cohn, assistant professor of economics at the University of Michigan, who co-authored this study.

A possible explanation for this could be that people like to see themselves as honest. When they do something dishonest, they repeatedly have to correct their self-image and battle against their inner self because deep within they know they have done something wrong.

Michel Maréchal, professor of economics at the University of Zurich, who co-authored the study explains, "People want to see themselves as an honest person, not as a thief. Keeping a found wallet means having to adapt one's self-image, which comes with psychological costs."

Still not convinced?

Take this example from Kashmir.

On June 25, news agency IANS reported that a taxi driver in Kashmir returned a lost bag of a tourist family in Shopian district. The report said the bag contained valuables worth over Rs 10 lakh ($14,411 approximately).

The driver, Tariq Ahmed, had taken the tourists to the popular hill station Aharbal. While returning, the family forgot their bag in Tariq's vehicle.

"Tariq worked hard to trace the family and finally returned the bag that contained cash, gold and smartphones worth over Rs 10 lakhs," sources in the state Tourism Department were quoted as saying by IANS.

Hope that brings a smile on your face.



Postscript: While this study examines response of employees handling reception desks at hotels, banks, post offices etc, it is unclear if the same results would be arrived at if these wallets were dropped on a street or at a public space. When asked about it, Michel Marechal, one of the authors of the study from the University of Zurich, told Associated Press: "We don't know." But he said other analysis suggest the new results reflect people's overall degree of honesty. The Associated Press report also quoted some independent economists and social psychologists who also opined that the results may not be very different if the wallets were dropped on a street.

The author tweets at @mukeshrawat705 and can also be reached out at Facebook.

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