The complicated ways that money messes with your morals

A string of studies appeared to show that rich people are more tight-fisted and less trustworthy – but what’s the truth in the claims? Claudia Hammond investigates.

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At some time or another you’ve probably found yourself in a bar where the richest person present seems to be the slowest to reach for their wallet when it’s time to buy a round. You might wonder whether they were always this mean, and maybe that helped them become rich? Or is there something about having money that’s made them mean?   

It’s a complex question and one that can be approached in many different ways. You could take a group of people known to be interested in the topic of money, such as economists, and compare their generosity with others. One study from back in 1993 did just this and found that the number of economics students who admitted to giving nothing to charity was double that of those studying architecture or psychology. The same researchers also found that economics students were less likely to behave kindly in games involving co-operation such as the Prisoner’s Dilemma.

When students were assessed at the start and end of their degree courses, those studying other subjects became slightly more generous as they approached graduation while economics students remained at the same less-generous level throughout. Of course these are averages, so altruistic economics students exist too.

In fact, there is some evidence showing that people who have more money, or who live in more expensive areas at least, might behave more altruistically. Researchers walked around 20 different parts of London, scattering 15 stamped, addressed letters onto the pavements in each area. Then they waited to see how many letters would be found by kindly passers-by and posted. In the richer areas such as Wimbledon 87% of the letters found their way home, compared with just 37% in poorer districts, such as Shadwell.

The better-off also appear to show their generous side more often with so-called ‘acts of extraordinary altruism’ – actions where there is little public recognition and no chance of someone doing the same for you in return. For example, Kristin Brethel-Haurwitz and Abigail Marsh from Georgetown University tried to find out why rates of kidney donation to strangers vary so much between different US states.

They looked at various factors including religiosity, but the strongest predictor was median income levels. Simply put, states where people earned more money saw more kidney donations. This doesn’t necessarily show that richer individuals are more likely to donate a kidney than poorer people. What it does suggest is that higher altruism seems to be associated with increasing affluence in a population, but this might because there are also higher rates of wellbeing, which in turn allow people to behave more altruistically.

Richer people were more likely to state that they were never wrong, and that they were good at everything

So with the exception of the economics students of the 90s, rich people do seem to come out of the research quite well. That’s until you read the work of Paul Piff from the University of California Berkeley.  In one study he gave people a series of statements to measure entitlement, such as ‘If I were on the Titanic I would deserve to be on the first lifeboat.’ Staggeringly some people did endorse this comment and the people who did, were more often rich than poor. The richer people were also more likely to agree that they were never wrong and good at everything, and to check their appearance in a mirror before their photo was taken.

In another study Piff assembled a group earning a range of incomes, some on as much as $200,000 a year, and gave each of them $10. They could choose how much of it, if anyone to give away. Piff found the poorer people were more generous.

But remember, these people were rich before they took part in Piff’s tests. Maybe it was not their wealth that dictated their behaviour, but their behaviour which helped them to become wealthy. Maybe being more careful with money, coupled with an inflated sense of self belief, helped them to get rich.

So how about making someone artificially wealthy? Would that change them? To find out Piff had people play a game of Monopoly with a twist. A toss of coin at the start of the game earned one player the right to begin the game with twice as much money as their opponent, and to receive twice the usual amount every time they passed Go. Not surprisingly, the advantaged players tended to start winning the actual game, but Piff watched proceedings through a one-way mirror to see what else might change once they became artificially “rich”.  Many were noisier, whooping and bouncing their racing car loudly around the board. Some took more than their fair share of a bowl of pretzels on the table, and after the game when asked why they thought they’d won, they talked of the effort they’d put in and the wise decisions they’d made. Not one person mentioned the financial advantage they’d been given from the start of the game. So perhaps having money, even temporarily, can make you more self-centred.

All the cheap cars stopped at the pedestrian crossing; only half the drivers of the expensive cars behaved so courteously

Piff has also spent his time hiding by pedestrian crossings in the San Francisco Bay Area to see whether the drivers of cheap or expensive cars are more likely to stop. You’ve probably guessed by now that the drivers of the fancy cars don’t come out so well, with all the cheap cars stopping and only half the drivers of the expensive cars behaving so courteously. But this study was pretty small. And of course the type of car was only a proxy for richness. Maybe they were driven by chauffeurs or bought on credit by people not earning very much.

Stefan Trautmann from Heidelberg University tried to avoid these uncertainties by using an authoritative survey of 9,000 people, conducted four times a year in the Netherlands.  He found that people with higher socio-economic status seemed to be more independent and less engaged with other people. But when they played games of financial trust, richer players were no more likely to betray their opponents than poorer ones.

The studies examining altruistic behaviour seem contradictory, so how about some hard figures on giving to charity? Is Warren Buffet – the billionaire who’s pledged to give 99% of his wealth away – a rare exception or do richer people give away a higher proportion of their salaries on average? You can compare income with the proportion of those earnings that people give to charity. The classic research on altruism tends to suggests that this graph would follow the shape of an upturned smile, with both the poorest and the richest giving a higher proportion of their income to charity, while people somewhere in the middle give less. But this earlier research tended to exclude people who give away no money at all – typically, the very poor who simply can’t afford it, and this can skew the figures.

As a group, the super-rich could lay claim to being more generous in their charitable giving

To take this into account, researchers at Boston College looked across income bands starting at $10,000 and going right up to $300,000, finding that the average percentage of income given to charity in the US is remarkably constant at roughly 2.3%. But when you look at the very top earners, the 2% earning more than $300,000, they give away on average 4.4% of their income. So, as a group, the super-rich could lay claim to being more generous in their charitable giving.

All in all, the Boston research would appear to suggest that the rich are neither more generous nor stingier than the rest of us – except at the top end. You could argue that they’re better able to afford it, but at least they make the decision to do it.

So the next time you notice someone rich who seems slow to pay their share at the bar, maybe it’s just them and it’s not that their money has made them mean. The research does reveal plenty of generosity among the rich, but perhaps the lesson is to guard against behaving with a sense of entitlement, particularly when playing Monopoly.


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