Honesty in the Digital Age

University of Zurich, Department of Economics, Working Paper No. 280, Revised version

37 Pages Posted: 7 Mar 2018 Last revised: 8 Jan 2021

See all articles by Michel André Maréchal

Michel André Maréchal

University of Zurich - Department of Economics

Alain Cohn

University of Michigan

Tobias Gesche

ETH Zurich, Center for Law & Economics

Multiple version iconThere are 2 versions of this paper

Date Written: December 1, 2020

Abstract

Modern communication technologies enable effcient exchange of information but often sacrifice direct human interaction inherent in more traditional forms of communication. This raises the question of whether the lack of personal interaction induces individuals to exploit informational asymmetries. We conducted two experiments with a total of 848 subjects to examine how human versus machine interaction influences cheating for financial gain. We find that individuals cheat about three times more when they interact with a machine rather than a person, regardless of whether the machine is equipped with human features. When interacting with a human, individuals are particularly reluctant to report unlikely and, therefore, suspicious outcomes, which is consistent with social image concerns. The second experiment shows that dishonest individuals prefer to interact with a machine when facing an opportunity to cheat. Our results suggest that human presence is key to mitigating dishonest behavior and that self-selection into communication channels can be used to screen for dishonest people.

Keywords: Honesty, cheating, human interaction, digitization, social image, screening

JEL Classification: C99, D82, D83

Suggested Citation

Maréchal, Michel André and Cohn, Alain and Gesche, Tobias, Honesty in the Digital Age (December 1, 2020). University of Zurich, Department of Economics, Working Paper No. 280, Revised version, Available at SSRN: https://ssrn.com/abstract=3131686 or http://dx.doi.org/10.2139/ssrn.3131686

Michel André Maréchal (Contact Author)

University of Zurich - Department of Economics ( email )

Zuerich, 8006
Switzerland

Alain Cohn

University of Michigan ( email )

105 S State St
Ann Arbor, MI 48109
United States

Tobias Gesche

ETH Zurich, Center for Law & Economics ( email )

Rämistrasse 101
ZUE F7
Zürich, 8092
Switzerland

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