The latest craze in behavioural economics is all a bit meta when you think about it.
It’s a game which gamifies academic courses, teaching you about how you can gamify everyday life. It’s a Kickstarter campaign for a product that discusses how traditional financial models are broken. And it’s an argument that people are irrational, which relies for its success on the irrationality of people.
But that’s the thing about behavioural economics. The more you dive into the theories behind it, the more there is to discover, like some sort of fractal Alice in Wonderland. Luckily, there are few proponents of the discipline more capable of making the case to the ordinary person in the street than Duke University’s Professor of Psychology and Behavioural Economics, Dan Ariely.
Dan Ariely has history in the public understanding of behaviour and its impact on the real world activities of tech start-ups and community improvement. His bestselling books include Predictably Irrational: The Hidden Forces that Shape our Decisions, and The Honest Truth about Dishonesty. He runs the Center for Advanced Hindsight and a consultancy, BEworks Inc, that applies his academic interests to business and policy challenges. He’s even given TED talks on how humanity’s moral code is “buggy”, and whether or not we are even in control ourselves of our own decisions. The one strand that links all his work, though, is the idea that we are not the homo economicus of rational utility-maximisation that mainstream economic models assume we are.
And his latest chosen vehicle to get the message across? A card game, like the ones you played as a child. But this is a card game with a difference, one with a pedigree, and one which is intended to leave you better informed and more interested in the world than you were before you started playing. Think of it like Top Trumps crossed with Monopoly, with a sprinkling of Rebus brain puzzles on top, and you won’t go far wrong.
We caught up with Dan a few weeks ago in preparation for the worldwide launch of the game, and asked him what it’s all about.
For someone who might not be familiar with your work or the idea of behavioural economics, what is The Irrational Game? Is there a simple elevator pitch-style description you might give?
Maybe we can start with the question of what Behavioural Economics is. So, in standard economics, we assume that people are all capable; people can make the right decisions, that they compute everything, that they think long term, and they always, always, always make the right decisions. In behavioural economics, we don’t assume anything; instead we put people in different situations and then we see how they behave. And when we see how people behave we find that people are often irrational, we don’t think the “right” way, and we don’t make the “right” decisions. And this means also that we make all kinds of predictable, systematic mistakes. These are not random mistakes that some people make, but rather, there is a systematic nature to these mistakes.
Now, what is the game about? There are many articles showing what mistakes people make and some books, I wrote a couple of books as well, but we try to put it in a game form rather than a book form because we wanted people to think about behavioural questions in a group. And the way that the game works is you are given a card that says here’s a description of an experiment, and you have to consider how you think people might behave? And the person who draws the card has to predict how they think people behave, and they find out if they are right or wrong, but you will also get a sense of the kind of mistakes people make; you’ll get to discuss them with your friends and family, and maybe put you on a path to making better decisions.
From someone with an academic background, a child-friendly card game might seem a radical departure from the norm. What’s the idea behind doing a card game, and what are you hoping to achieve by developing it?
So, I think there’s this notion that people can gain knowledge by reading – and that’s true – but I think that when you gain knowledge by reading, you are passive about it. And you can basically not digest it to the same degree. We call our research into this the Center for Advanced Hindsight. And we call it that because in retrospect you can look at different results and say “Oh, yes, I knew that all along” but of course, you didn’t necessarily know it all along, but it’s easy to convince yourself that you did. So the game is supposed to basically encourage more active thinking, confront your true beliefs before you read the results, and facilitate a discussion about what would the results mean and what would it mean for other things as well. So I think if it’s just a card game and you finish, people are just reading it and guess and not have a discussion, then the game would not have a higher value than a standard card game, but if people would actually think about the question, think about what it means in their life, and think about how to implement changes which come from that, then this game, could serve people incredibly well and serve a good catalyst for change.
You ran a crowdfunding campaign to fund the development of the game. Why was that? And how does it tie into your work on irrationality – (i.e. something like “why would anyone get involved in a crowdfunding campaign with no guarantee of a product at the end of it?”)
Two things. We did a crowdfunding because we wanted to also gauge the interest of this, so the game took a tremendous amount of work. Taking a single study and putting it down, editing it down to a card format, takes about two hours, multiplied by 140 cards, and that’s just a small part of the effort that went into the graphic design and the production, so the amount of work was incredible – actually, taking about advanced hindsight, it was more than we anticipated – but we wanted to know that there was some interest in it before we dived headlong into it.
The second thing about crowdfunding in general is that crowdfunding gives people a different sense of participation. You see, when you buy a product after it’s been made, you’re just buying, but when you’re supporting a product before it’s been created, you’re helping bring it to life, and not only are people more willing to pay under those conditions, but people are more willing to give advice and contribute and take suggestions, and we were the beneficiaries of those suggestions because in many cases, we got really good advice from people about how to create the game and what sort of things to change. So my experience of crowdfunding was great, and I think it’s particularly good for people who are open to getting feedback from people and shape the product.
Your previous public-facing work has led to the perception that you are at odds with the underpinnings of much mainstream economic thought. Is this an accurate reflection of your views, and how do you see that you and your peers in behaviour science may have influenced the economic orthodoxy in recent years?
The economic basic discipline has, sadly, not been moved much by behavioural economics. There are individuals who have a lot invested in the current mainstream belief in rationality, they spend their career in it, and they basically start making these simplified assumptions about rational thought. And what happens is they sometimes forget that they are just assumptions, they start treating them as if they are fact, and sadly I don’t think that behavioural economics has done a lot to change that.
On the other hand, economics is not just an academic discipline. Or rather, it’s not just a descriptive discipline, it’s also a prescriptive discipline, wherein economists tell people, “this is how you run your life, this is how you do things”. And now the issue is not just within academics, it’s within governments and companies, so as long as people just take academic knowledge from economics at face value, then say “this is how to create pricing, this is how to create policy” and so on, they are likely to make mistakes, but if behavioural economics is winning some of the mindset of the public, of business, and of governments there is a better chance that they will not follow economic advice blindly, they will think more about it, they will implement some of the behavioural economics’ perspective and build things in a different way. And I think that that fight for the public understanding – and within business and government – is making tremendous strides at the moment.
At Ethos, we like to profile people working at the intersection of new business models and ethical enterprise. With that in mind, I’d be interested if there are ways in which your past work, and also The Irrational Game, might influence the business world to be both more successful and more caring. Do you see yourself as having that kind of impact in that sphere?
My biggest attempt to work on business and ethical enterprise has been with my book on dishonesty, and the movie that came out about it, so you can check a website I created, www.thedishonestyproject.com, where we spent a lot of time creating a documentary on dishonesty to take the findings that we have and present them in a visual format. So for instance, in the research lab, we have been tempting people to steal money from us. And we’ve been seeing how much they will steal, under what conditions they steal more or steal less, and how we can change it and modify it. In the book, this was based on our research, so we were necessarily limited in terms of how much we could get people to steal from us. But in the movie, we could also talk to people who did all kinds of terrible transgressions, and there we showed the story that lots of dishonesty is about slippery slopes, and I think it’s a an important cautionary tale for people to realise that dishonesty is really not all about so-called Big Cheaters. Yes, they exist and sometimes it’s terrible, but it’s more about the intrinsic human capacity to be dishonest and still think of ourselves as honest people, so I think the biggest chunk on the ethics of business and ethics in general is in that work. But of course, the card game has important cards on that as well.
The other thing to realise is that the whole perspective of behavioural economics is that the environment matters, and if we make things different in the environment, we can get people to behave differently. And from that perspective, if you want to get people to be more ethical, it is a question about the environment and what kind of changes you can make and from that perspective, you can learn about all kinds of behaviours and think about how to implement changes in the environment in order to get behavioural change.
One of the most interesting things about The Irrational Game is that it works on a number of levels. So people can just play for fun, and you also direct players who might want to know more about the academic research to your website to see the reference to the original papers themselves. What was the thinking behind that, and will you be trying to make the papers accessible to the public on the back of expected demand?
The nice thing about the game is there are many, many different types of questions, there are different topics, there are different experiments, and so on. And the hope is that some people will become more interested in some of those aspects, and will want to understand them better. Some of those things, we hope, will talk to their life in a better way. One of the things that happened with my first book, Predictably Irrational, is that there were lots of different chapters, and they each resonated with different people, which was great. So we are hoping to see the same thing with the game – that different aspects of the game will excite different people, and they will want to investigate them in more depth. So, as much as we can, we’re going to make the academic papers that the game is based on more accessible. Copyright rules have stopped this a little, but we’re working on that.
When does The Irrational Game ship to the public?
We expect to start shipping it in June. There are two versions, EXTRA IRRATIONAL, a limited edition Kickstarter version, including 130 question cards for $34, and BASICALLY IRRATIONAL, including 105 question cards for $24.