On the occasion of the publication of a new book, behavioral economics writer Dan Ariely (a great favorite of mine) answers questions with Wired about the underlying causes of lying and cheating, and the huge gap between what the evidence tells us and what be intuitively believe.
Ariely: If you thought that crime or dishonesty is driven by a cost-benefit analysis, then you have some very basic solutions — for example, put people in prison. And people who were going to commit a crime would say, 'Okay, I'll go to prison, not worth it.' I've been talking to big cheaters, including people who have been to prison, and I tell you, nobody I've talked to has ever thought about the long-term consequences of their actions. How many people who did insider trading thought about the probability of being caught and how much time they would get in prison? The number is incredibly close to zero, maybe exactly zero. What will happen if we increase the prison sentence? Basically nothing, because it's not part of their mindset. What we need to understand is the process by which people become dishonest.
We can look at a cheater and say, we would have never been able to do that. But when we look at the long sequence of events, you see it happened over time. You can ask, did the person who was the criminal think they would take all of these actions, or did they just take one? They took one step that they could rationalize. And after they took one, they became a slightly different person. And then they took another step, and another step. And now you think very differently about dishonesty.