Are economists selfish? Not according to Monopoly

15th February, 2024

Against my better judgment, I was recently prevailed upon to play a game of Monopoly with the family. It soon developed in a fashion that has become familiar: everyone tried to rip everyone else’s face off, except me. I proposed a mutually beneficial deal to each player, offering extra concessions myself to make sure those deals got done.

This dealmaking tactic didn’t go down well. Every time I reached an agreement with one player, the other players fumed. Before long, I was being roundly denounced as a ruthless exploiter of innocents.

This made me sad. It was partly the disheartening realisation that I am clearly a punchable opponent at the board-game table. But there was something more. My plight in being cast as a pantomime villain seemed to stand in for the fate of economists as a whole.

I should explain. In looking for advantageous trades, I was doing what comes naturally to economists. The basic building block of economic activity — so basic that we take it for granted — is two people making each other better off by finding gains from trade. You can easily spot the economists at the Monopoly table, they’re the ones trying to find the deals that make both sides happy. But are we lauded for our fascination with voluntary agreements for mutual benefit? We are not. Instead, economists are often accused both of celebrating selfishness and of being selfish. As Yoram Bauman, an economist and comedian, once joked: “The only reason we don’t sell our children is that we think they’ll be worth more later.”

What have we done to earn this reputation for ruthlessness? Perhaps it’s that altruism and charity are not front and centre in economic analysis. It may be the character of Gordon Gekko in Wall Street (1987), assuring us that “greed, for lack of a better word, is good”, somehow being associated with economists.

But our reputation for being calculating and unfeeling may also be thanks to the experimental evidence. Over the years, a series of studies have emerged which seem to show that studying economics causes students to behave more selfishly. The basic idea sounds plausible. If you sit in enough classes being told that people are fundamentally self-interested, you yourself might become more self-interested.

A 1993 paper by Robert Frank, Tom Gilovich and Dennis Regan summarised some of this evidence. It found economics students tended to behave less cooperatively in experimental games. They also expected less honesty from others. For example, if asked whether they would expect a stranger who found some lost cash to try to return it. More recent research by Bauman and his colleague Elaina Rose found that economics students were less likely to contribute to two named charities in a classroom exercise.

Yet there is a pair of big question marks hanging over this collection of studies. The first is whether economics teaches people to be selfish, or whether instead selfish people gravitate towards economics. Bauman and Rose note that economics majors are equally mean whether they are near the beginning or the end of their studies — in other words, perhaps economics has no effect on people’s generosity, but big-hearted people avoid economics classes.

Perhaps more important, do these questions really measure honesty, selfishness or any other moral virtue? That’s not clear. In the Bauman and Rose study, for example, the two charities in question were both left-leaning activist groups. So did economics students refuse to contribute because they hate giving to charity? Or did they feel that these particular charities were not very worthy causes?

As for classroom exercises, there is a sense in which the selfish move is the “correct” answer in certain experimental settings, such as the prisoner’s dilemma game. If a student is taught that, and then plays the selfish move, have they become more selfish in everyday life? It seems just as plausible to suggest that they have been taught how to reproduce the textbook answer in an academic setting and want to pass the economics test.

There are certain tendencies in mainstream economics that might nudge people towards a cynical view of human nature, but there is also a long tradition in economics arguing that free markets promote co-operation, honesty, respect for others, freedom and reciprocal benefit.

So does studying economics make you selfish? A new study with that title, by Girardi, Mamunuru, Halliday and Bowles, finds “no discernible effect” of studying economics either on self-interest or on the belief that other people are self-interested.

I suggest that before besmirching the good character of economics students we should look for more convincing real-world evidence. So far I have found nothing. But my search did turn up the fascinating discovery — courtesy of the philosopher Eric Schwitzgebel — that books about moral philosophy were more likely to be missing from libraries than other philosophy books. A deep academic interest in ethics appears to be correlated with larcenous behaviour. It makes you think.

Ironically, the game that inspired Monopoly, The Landlord’s Game, was designed by the activist and writer Elizabeth Magie to teach lessons about a fairer taxation system, and then refined by a socialist professor of economics, Scott Nearing, and his students. Yes, the economics nerds were proposing a co-operative, pedagogical version of Monopoly. Alas their vision was eclipsed by the ruthless battle of attrition we all know today.

Our own session of Monopoly might have been more fun if only my fellow players had embraced the constructive, co-operative spirit of economics. Alas, they did not, so our game finished in the traditional fashion. It petered out with no clear winner and several sore losers.  

Written for and first published in the Financial Times on 19 January 2024.

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