Economics of Lies: Causes, Determinants and Experimental Measurements

Abstract

The goal of this article is twofold. First, we present the foundations of modern economic approach to lie (cheating) and survey its experimental measurements, which are being actively developed in recent years. Second, we describe design and results of several experiments in Russia performed at the laboratory of experimental and behavioural economics of HSE. Our results confirm the hypotheses that decisions to lie depend crucially on the potential gain from cheating, as well as on moral considerations, such as dignity and self-respect, which have to be sacrifized in case one decides to cheat. In particular, cheating in Russia was found to be even lower than in most analogous studies in other countries, especially among the mature and responsible experimental participants.