Are rich people less ethical?

(MoneyWatch) We've read a lot in the news over the last few years about unethical behavior by seriously rich people. And the common response is often the same: Why, when you have so much money, would you feel the need to behave so badly? Surely once you have the security of money, that should make you feel - and behave - better, not worse.

A group of researchers at UCBerkeley and the Rotman School in Toronto decided to see if there was any underlying rule in human beings that might explain what we were seeing. Were the news stories - about the Madoffs and the Rajaratnams - just a series of anomalies or was there something more important that we should understand about the rich?

Paul Piff and a team of associates devised a series of seven experiments, some in the lab and others out in the real world. In the first two, they studied driving habits at a busy cross roads. Using the make of a car as a stand-in for social status, they wanted to know whether it was the drivers of expensive cars that were more likely to cut off other drivers and less likely to yield for pedestrians. As you might expect, the drivers of fancy cars exhibited more anti-social, unhelpful behavior.

In a lab experiment, after assessing the social class of participants, they asked them a series of hypothetical questions concerning a salary negotiation with a job candidate. Would the better-off negotiators be more or less unethical when it came to telling the truth, which meant revealing that the job was due to be eliminated within a year? It turned out that those with higher social status were less inclined to be honest. That group also had more positive feelings about greed. One reason, the researchers concluded, why lower-class individuals tend to act more ethically is that they hold relatively unfavorable attitudes to greed. And in a game involving six-sided dice, further experiments demonstrated that high social class was a positive predictor of cheating.

Why, the academics asked, are upper-class individuals more prone to unethical behavior - from violating traffic codes to taking public goods to lying? Because, they argued, these individuals feel fewer social constraints. Their wealth makes them less dependent on others, less concerned with how they're viewed and it gives them more resources for handling trouble (like traffic fines) should it come along.

All of this correlates with a vast body of research which shows that money is at odds with a sense of social connectedness: The more money people have, the less they need or think about one another. Not surprisingly, power operates in much the same way. "The pursuit of self-interest," the new study says, "is a more fundamental motive among society's elite and the increase want associated with greater wealth and status can promote wrong-doing."

This is far from a one-off study; it's part of a growing body of work I encountered when researching my book. It goes a long way towards explaining why increasing shareholder outrage about compensation should be taken seriously and why it is about very much more than just envy. Extremes of wealth divide society, making some people feel they can buy their way out of the rules the rest of us abide by.The rich are different from you and me, as F. Scott Fitzgerald observed. But what he didn't point out was how much that costs us.

  • Margaret Heffernan On Twitter»

    Margaret Heffernan has been CEO of five businesses in the United States and United Kingdom. A speaker and writer, her most recent book Willful Blindness was shortlisted for the Financial Times Best Business Book 2011. Visit her on www.MHeffernan.com.

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