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'Moral Reminders' May Help Clean Up Wall Street

In one of the experiments that Ariely ran, some students would get cash on the spot when they reported to the room monitor how many problems they'd solved correctly. But other students were forced to go through two steps, first reporting to one person what they were owed and getting plastic chips representing the amount; and then walking over to a table to pick up their money. The ones who had a step separating their lie from their receipt of the money cheated twice as much.

There's probably no risk that it will put insider-trading rings out of business, but Ariely does come up with promising ideas about honor codes. He tempted students from several universities to cheat, thinking that the ones from Princeton, which has a long-established and rigid code of honor, would cheat less than the ones at MIT and Yale. But he learned that all it took was two weeks from the time Princeton freshmen had finished their ethics training before they would cheat in Ariely's experiments just as much as the others.

That, of course, is nothing to be inspired about, but along the way, Ariely observed this: Remind someone about their ethical obligations right before they're exposed to temptation, and they're less likely to cheat. Remind them after -- like asking for a signature at the end of an exam -- and it's too late. A takeaway from the honor code research is that if you remind people early and often to do the right thing, it actually makes a difference.

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