October 6, 2022

SMU Office of Research and Technology Transfer - The wealthy are sometimes seen as selfish, prioritizing their own needs over those of others, despite their ability to share. The idiom "the more you have, the more you want" is so well known that there's even a book that distills conversations with over 1,000 of the richest people on the planet into a simple message: Selfishness is a good thing.

Lynn Tan, a psychology doctoral student at SMU's School of Social Sciences (SOSS), is currently working on research showing that the wealthy are more likely to share, but only if the population is denser.

“The denser the population, the more likely people are to cooperate,” she writes in her working paper, “Cash, Crowds, and Cooperation: Wealth Increases Cooperation Only When Population Density Is High.”

"I evaluated the concept of 'collaboration' against a task in which participants in an experiment were given a hypothetical $10 to distribute between themselves and a randomly assigned partner they did not personally know. They had to Make a choice in the $0 to $10 range, how much they want to give to their partner, or keep it for themselves.”

This is known as the dictator game, and is commonly used in psychology and behavioral economics to assess the propensity to cooperate. This task captures cooperation by measuring people prioritizing their own needs or goals (i.e. selfishly getting more money) or the needs or goals of others.

this experiment

Two groups of participants were shown 12 photos of places in Singapore, with one group appearing empty and the other crowded to "manipulate their sense of crowding".

Participants were also asked to rate their subjective wealth on a scale of 1 (low socioeconomic status) to 10 (high socioeconomic status) and compared the results of the dictator games on the crowded/empty and subjective wealth ladders.

Essentially, Tan examined the difference in giving between two groups of participants who rated themselves by the same number on the wealth ladder. Among those who rated their wealth highly, those who saw pictures of the Singapore crowd paid an average of one dollar more than those who saw the open space.

What is the explanation for this behavior?

"We believe that people respond psychologically to ecological cues and will act cooperatively only when ecological cues are in their favor," she wrote. "One such situation is that in situations of high population density, social Capital and reputation are critical to long-term survival."

"When people think population density is high, those who feel wealthier are more cooperative because they have the resources to do so. When population density is high, reputation information spreads very quickly through social networks," Tan explained. "So, if you have the ability to do so, you should be more cooperative and build a positive reputation in a close-knit social network."

She elaborates: “The higher the population density, the more interconnectedness in communication, so people need to be more mindful of their reputation. It seems that when our human psyche detects high density, it automatically triggers the Behaviour, especially when we have the money to afford it, such as having extra money to help others.

"By contrast, in low-density environments where reputation information doesn't spread as quickly, people with more money have no incentive to be more cooperative because they don't need to 'maintain their reputation' because communities are not interconnected."

Tan also compared the results of her experiments with those conducted in the United States, where the population density is one-eighth the size of Singapore. She found that the richer the U.S., the less likely they were to cooperate, although she conceded that in dense urban centers like New York City, the results could be different.

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