As it turns out, your suspicion that Wall Street might not have your best interest in mind has some scientific validity. A new study establishes that people who are interested in finance are less likely to share their wealth with others when the benefit to themselves is unclear.
A team of business and economics professors conducted an experiment in which they gave each of the subjects in Room A $10 dollars and told them that each dollar they decided to send to Room B would triple. So a Room A subject who gave up half of his fee would contribute $15 to Room B. Room B subjects would be allowed to send some of their gains back to Room A.
What the economists discovered is that the Room A subjects sent an average of 38.7 percent of the fee to Room B. There’s a rough equality to that. Sending $4 to Room B would mean that Room A folks kept $6, and Room B folks got $12. If they split the difference so that Room B sent back around half of their “excess” gain, each would wind up with $9. And sure enough, the Room B inhabitants sent around 20.5 percent of their income back to Room A, suggesting that people roughly understand a fair distribution of gains.
But the study that found people with an interest in finance were not quite as willing to share their gains. Those with a low interest in finance tended to return 24.3 percent of the award, while those with a high interest returned 15.5 percent.
The financially interested were not just more self-interested, according to the authors of the study. They were also less trustworthy. When they were in Room A, they tended to send the same amount as everyone else. But when they were in Room B, which is the room that got the gift from the others, they shared less of their gains.
“If the people later on working in the financial industry were simply more selfish, then you would expect that they would send less as first mover,” one of the professors told Bloomberg’s Justin Fox. “They have the same level of trust in other people, but in their reaction to being sent the money they behave differently.”
Don’t get too smug about this. Since you are reading this, you are likely to be in that 15.5 percent club.
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