That’s the lesson from his new research Mariam Kouhaki, professor of management and organizations at the Kellogg School. In several experiments, Kouhaki and her colleagues—Celia Chui of HEC Montreal and Francesca Gino of Harvard Business School—found that people cheat at higher rates in larger groups.
Why; The researchers found an interesting self-fulfilling prophecy at work: people expect there to be greater numbers of cheaters in larger groups. This perception, in turn, increases the sense that cheating is common and therefore acceptable.
The study demonstrates the importance of context and social norms in determining whether we behave ethically or not. After all, we don’t magically transform from saints in groups of five to sinners in groups of 100. Instead, we unconsciously dictate other people and what we expect their behavior to be.
“When you think your behavior is normative,” Kouhaki explains, “then it seems more defensible. Questionable behavior seems more justified when you think more people are doing it.”
Bigger groups, more scams
The researchers began their research by recruiting 88 participants to complete an in-person study. Participants were randomly assigned to a room with either a small group of 5 people or a large group of 25 people.
Participants were told they could earn money by solving 10 word puzzles in three minutes, $1 for each one they solved. But there was a catch: they had to complete the puzzles in order to get paid—that is, if they solved the first and third, but not the second, they would only be paid $1 for the first. They would also receive an additional $10 bonus if their performance was in the top 20 percent of the room.
Participants did not have to report solutions to the word jumble—only which ones they solved, which presented a tempting opportunity to lie. And unbeknownst to them, the seventh word jumble was unsolved, allowing investigators to determine with certainty whose pants had caught fire.
The results were clear: in the small groups, 27 percent of the participants reported solving the unsolved word jumble. In the large group, this figure rose to 54 percent.
The researchers found the same pattern when they did a similar experiment with a group of 187 online participants. Participants were only informed of the group size, but could not see their competitors. Consistent with previous results, they cheated at higher rates in a group of 100 than in groups of 10. In the large group, participants reported solving an average of 1.14 unsolvable word puzzles, compared to 0.747 in the small group. groups.
Everyone else is doing it, so why can’t we?
While these first two experiments found strong evidence of greater cheating in larger groups, they did not explain why. So, for the next experiment, the researchers investigated this question directly.
They recruited 296 online participants, assigned them to either a large group of 100 or a small group of 10, and instructed them on the word-mixing task used in the previous study. Rather than actually completing the task, however, participants answered a series of questions designed to explore the mechanism behind large group cheating behavior. The researchers asked participants, for example, how many people in their group they thought would cheat, whether they thought the cheating was in line with the group’s rules, and how likely the cheaters were to be caught.
The researchers found that as the group size increased, so did the expected number of cheaters. Statistical analysis revealed that this greater number of expected cheaters made people view cheating as more normative. Their analysis showed no clear correlation between expectations of being caught and the likelihood of cheating.
It is worth noting that only the expected number of cheaters—rather than the expected rate of cheaters—had the effect of making cheating feel normative. Participants in large groups expected, on average, 36.95 people to cheat. Small group participants said 4.55. This translates into a higher rate of expected cheating in the small group (45.55 percent) than the large group (36.95 percent).
The researchers suspect this is related to a common fallacy called ratio bias. Studies have shown that people will choose a 7 in 100 chance of winning over a 1 in 10 chance of winning, even though the odds are worse. This is because our fallible brain focuses on the numerator and thinks, essentially, “well, seven is more than one – better odds!” Similarly, if you believe that 37 out of 100 people in your group will cheat, lying seems more prevalent than if you believe that 5 out of 10 people will cheat—even though this perception is not accurate.
In other words, our collective, if flawed, belief that others are more likely to cheat in large groups becomes a self-fulfilling prophecy, prompting more of us to cheat when we are in these large groups.
Because bigger is not better
How can we avoid the moral hazards of large groups? Perhaps keeping the pool of competition small. By minimizing the number of other competitors, leaders can reduce their employees’ expectations of facing multiple cheaters and, as a result, reduce the chances that they will cheat themselves, Kouhaki and her colleagues suggest.
Most importantly, be clear about how employees are expected to perform.
Communicating your expectations for honest, accurate, and transparent performance will reduce employees’ expectations that others will cheat. This can help, even if the size of the competition group cannot be reduced, as you will reduce employees’ expectations that others will cheat.
And finally, don’t assume that people know that cheating is okay. When people in larger competitive groups expect more people to cheat to win, they tend to think that cheating is more acceptable and end up cheating more themselves. Leaders can address these perceptions by clearly emphasizing which performance behaviors are acceptable and which are not.
And, of course, there is no substitute for fostering an ethical culture.
For Kouhaki, one of the sobering lessons of this research is how easily we justify unethical behavior. Something as simple as the size of our reference group can make the difference between deception and telling the truth. Well, a warning: left unchecked, he says, “these little psychological processes could create a path to a truly corrupt culture.”
