A few years ago a contributor to a marketing technology blog warned other parents of the risks of Webkinz thievery after a classmate broke into her eight-year-old daughter's account. The classmate stole the daughter's hard-earned KinzCash and left her pets unfed and out of their beds. "My child feels violated, as if she actually experienced a violent crime," the mother wrote. "And in her world, she did."

Last year, at a private school in Northern California where my niece is a student, several second-graders became the victims of a peculiar and disturbing crime. Like many private schools, particularly those near Silicon Valley, this one has computers in every classroom, and "technology instruction" begins in kindergarten. Children carry cell phones from an early age and computer and Internet use is ubiquitous by fourth grade.

Many of the school's second-graders, like elementary-school children nationwide, are also enthusiastic consumers of Webkinz. Webkinz are traditional stuffed animals sold in toy stores. Unlike traditional stuffed animals, each Webkinz animal comes with a tag bearing an "adoption code" which, when registered on the Webkinz website, gains the owner entry into an online world. A combination of kiddie gaming, virtual reality, and rudimentary social networking, Webkinz taps into children's traditional fascination with plush toys and marries it to online exploration. "Come in and play!" the Webkinz website urges, promising an "exciting online experience where your plush pet comes to life." Indeed, pixilated Webkinz have become so appealing that their furry real-world counterparts are sometimes forsaken. A few years ago, retailers in New York City noticed that people were stealing Webkinz tags but leaving behind the stuffed animals, presumably because they preferred an online Webkinz experience to the limited delights of a the real-world version.

Webkinz World is appealing to children because it encourages them to hone their nurturing skills in an environment suffused with positive reinforcement and focused on perpetual entertainment. Webkinz owners are expected to feed, exercise, and play with their virtual pets. Happy, Health, and Hunger meters monitor their Webkinz' gestalt and owners are given frequent reminders about the need to pamper their pets: Poodles enjoys dining on Lobster Kibble Bisque, we are informed, but Unicorns prefer Sparkling Flower Fondue. Children pay for their pet's accoutrements, such as a Banana Hammock for Cheeky Monkey, and buy gifts for Webkinz friends with KinzCash, which they earn by answering questions or playing games with names like "The Wheel of WOW" in the Webkinz virtual arcade. They can also talk to their friends on Webkinz by using KinzChat, a rudimentary form of instant messaging that limits comments to a few safely anodyne phrases available on a drop down menu, thus reducing the likelihood of bullying and harassment in Webkinz World.

One rainy afternoon at my niece's school, the second grade teachers gave their students permission to spend time on the classroom computers. The boys' and girls' thoughts quickly turned to Webkinz, and one girl decided that it would be useful to have the user names and passwords of her friends so that she could log into their accounts and surprise them with gifts and other Webkinz treats. Her friends eagerly complied with her request, but when she absentmindedly left the list next to her computer terminal, another classmate took it. What ensued was virtual larceny on a grand scale.

The wee criminal mastermind methodically pilfered items from the virtual space of every one of her classmates' Webkinz accounts and gifted them to herself in a virtual crime spree that lasted several days. She was discovered only after her father happened to glance at the family's home computer one evening and saw her Webkinz room stuffed with virtual contraband. When he asked her how she had accumulated such a large virtual stash, she quickly confessed. The girl's parents purchased new Webkinz for each of their daughter's victims as a form of restitution, but several of the girls' classmates still recall the episode with bitterness and astonishment.

This episode was not unusual. A few years ago a contributor to a marketing technology blog warned other parents of the risks of Webkinz thievery after a classmate broke into her eight-year-old daughter's account. The classmate stole the daughter's hard-earned KinzCash and left her pets unfed and out of their beds. "My child feels violated, as if she actually experienced a violent crime," the mother wrote. "And in her world, she did. I can't even describe the look on her face. It took me hours to try to calm her down." Another blogger ruefully admitted that her older daughter, under the pretense of tending to Perky Ballerina, the Webkinz alter-ego of her younger sister, successfully cleaned out Perky's KinzCash bank account and spent the money on items for her own Webkinz' lair. In another case, a 13-year-old babysitter wheedled and bullied her six-year-old charge into telling her the password and username of the girl's Webkinz, then absconded with several of the girl's exclusive Webkinz possessions. And last year, an elementary school in Easton, Mass. banned Webkinz from school grounds after an exclusionary clique formed among children who had Webkinz and were lording it over those who did not.

Children have always found opportunities to bully and steal from one another, of course. But as these activities moves online, how are they quantitatively and qualitatively different from traditional misbehavior? Given that the average person in the U.S. spends nearly eight-and-a-half hours in front of some form of screen technology every day, this is not an idle question, nor is it one we should be asking only about children. Is our sense of self-control and moral justice the same online as offline? Does the medium of the screen make us more or less likely to be honest with each other? How does technology aid or impair our ability to detect falsehood? Most importantly, does our behavior online alter our behavior offline in significant ways?

A range of new research in the social sciences offers some provocative insights - though no definitive answers-to these questions. Professor Jeff Hancock of Cornell University and his colleagues in forensic psychology have been studying the effect of computer-mediated-communication on lying for several years. Are we more or less likely to lie to someone if we are communicating via email or text message than if we are speaking face-to-face? The first part of Hancock's research revealed that the conventional wisdom is correct: liars are more likely to reveal themselves in face-to-face conversation than in any other medium. But Hancock discovered something else: using the computer actually encouraged people to lie if they were motivated to do so. His findings "empirically demonstrate that there are potentially important differences for detecting deceit depending on whether the motivated sender is interacting in a face-to-face or in a computer mediated context." So dramatic was this feature of computer-mediated communication that Hancock and his colleagues called it the "motivational enhancement effect" and they warn that as we spend more time communicating online, this effect will have "important implications for social, business and even criminal electronic communications." In other words, when it comes to honesty, it's not just the motivation of the liar that matters, but the medium in which he operates.

Other researchers have found that the way we act and behave online, whether playfully, flirtatiously, dishonestly, or virtuously, has implications for our offline behavior as well. As the New Scientist summarized the research a few years ago, "acting out a particular personality online reinforces the behavior, making it more likely to be followed in real life." This is what Nick Yee, who is conducting some of the most fascinating research on virtual environments and behavior in Massive Multiplayer Online video games, calls the "Proteus Effect," after the Greek god Proteus who would change form to avoid having to reveal the future. "Our self-representations have a significant and instantaneous impact on our behavior," Yee wrote in a paper about the Proteus Effect. "As we choose our self-representations in virtual environments, our self-representations shape our behaviors in turn."

The Proteus Effect can be positive: psychologists have developed role-playing games that claim to help people build self-esteem or treat phobias such as a fear of spiders, for example. But other online activities - such as posting anonymous vitriol online or devoting hours to virtually slaughtering others in a video game-can have the opposite impact. In the most extreme and horrifying case of online behavior influencing offline life, a South Korean couple earlier this year left their infant to starve to death at home while they played hours and hours of video games online at an Internet café; the games involved raising a virtual child. As one South Korean psychiatrist told the New York Times, in South Korea, where the government already offers addiction counseling to children hooked on gaming and where the culture of 24-hour-a-day Internet cafes is well-entrenched, "the line blurs between reality and the virtual world."

It is this fact - the blurring of the line between real life and virtual life-that poses the most serious challenge for younger children, as the anecdotal evidence of Webkinz kiddie-crime suggests. Teaching children to practice honesty and empathy is a difficult task in any age; does early immersion in online worlds make it more difficult? Another recent study, presented at the annual meeting of the Association for Psychological Science by researchers from the University of Michigan's Institute for Social Research, found that "college kids today are about 40 percent lower in empathy than their counterparts of 20 or 30 years ago." When asked for an explanation for this precipitous decline in empathy, researchers pointed out that this is the generation raised with computers and video games. They suggested that the dramatic increase in exposure to media, including reality television shows, video games, and social media sites such as Facebook, can't be discounted as likely culprits. "College students today may be so busy worrying about themselves and their own issues that they don't have time to spend empathizing with others, or at least perceive such time to be limited," one of the researchers said.

You need not be a Luddite to suspect that the vast amount of time we all spend in front of the screen is changing us, and yet this is an acknowledgement we are loathe to make given how much of our work, social connection, and leisure depend on the screen.

This isn't merely the tut-tutting of an older generation about the technologies of a new one; on the contrary, the older generation has enthusiastically embraced the new technologies as well. The uneasiness many people feel-expressed perceptively in recent books such as Jaron Lanier's You Are Not a Gadget and Nicholas Carr's The Shallows-concerns the quantity and meaning of the time we spend with these new technologies, not merely the quality of the old technologies they are replacing. In this sense, our screen-dominated world is a dramatically different place from the world of our parents and grandparents. When the telephone arrived, it took decades to infiltrate private life, and few Americans went from spending no time with it to spending the majority of their waking hours talking on it. We have done this with the Internet in less than a generation. As we continue to live more of our lives on the screen, we should be honest with ourselves about its pleasures and provocations -but also its perils. Honesty might be the best policy, but online it is, alas, not always the most highly valued commodity.