Jonathan Schulz (University of Nottingham)

Societal Differences in Honesty (with Simon Gächter)

Abstract

Honesty matters in many economically relevant contexts like claiming social benefits, tax compliance, or educational attainments. On an aggregate level dishonesty may have a negative impact on economic prosperity. Experiments in industrialized societies find a substantial fraction of honest and non-maximal cheaters. Is such behaviour common among societies? In a cheating experiment conducted in 16 countries that diverge strongly according to several widely used cultural and economic indicators we find societal variations:  GDP per capita differs with our experimental measure for honesty.

Even though participants are not in a strategic situation, we find that an individual's belief about others' behaviour correlate with honesty. This suggests that experiencing a dishonest environment has a detrimental effect on honesty. We find that macro level indicators relating to unfair environments like a weak rule of law or a higher level of corruption are associated with lower average honesty in a country.