How do we increase trust? What are the things that could get trust to be higher and the things that could get trust to be lower in society and how could we add trust? You can find out the answers to these questions in this TEDx Talk by Dan Ariely, James B. Duke Professor of Psychology & Behavioral Economics at Duke University.
Following is the full text of Dan Ariely’s TEDx Talk titled “Designing For Trust” at TEDxPorto conference.
Dan Ariely – TEDx Talk TRANSCRIPT
Very happy to be here, also a little sad.
I’m very happy to be here, because it’s a wonderful city and it’s a wonderful event.
I’m a little sad to be here, because Ron, who’s sitting in the back there, Moran, and myself a few years ago decided to spend a month traveling together every year, and this is the end of our trip together. So it’s a little sad that we have to wait another year to start our next journey.
One more comment: you might have noticed that I have half a beard. You might have wondered why. It is not because I did not wake up in time.
Many years ago, I was badly burned, most of my body is covered in burns, including the right side of my face. So I just don’t have hair on this side of my face. I didn’t plan on this. It looks symmetrical, but it’s because of how the explosion happened, and if you’re wondering, I’m not recommending half beards.
Let’s talk a little bit about trust. One of the amazing things about trust is how much trust we have and how little attention we pay to it.
Think about banks. You put your money in the bank, and generally, you think you’ll get it back. You get a babysitter for your kid. Some 15-year-old you’ve never met before, and you give them your kid, and you expect them to be healthy when you come back.
My phone is in the back room back there; my passport and money is in a room in a hotel – I’m not going to tell you which one. We have tremendous trust, and like many other things, when trust works, we take it for granted. We notice only when it goes badly.
I’ll give you one example of something that went badly for me. I was in a country in South America – I will not tell you which one – and I was going to buy a pen. I went to a store, and there was this glass cage, and there were little pens underneath it. I point to one of the pens that I wanted, and the person behind the counter wrote me a little note and pointed to another corner of the store.
I went to that corner of the store with the note, and I gave the note to a person, and he told me how much to pay him. It was about $12. I paid him $12, and he gave me another note and pointed me to another corner of the store.
I go to this third place, and I meet another person, I give him the second note, and I get the pen.
Now why do you think you need three people to sell a $12 pen in an empty store? I was the only client.
Because the owner of the store didn’t trust anybody. He didn’t want anybody to have the money and the pen at the same time, so he created this incredibly elaborate and expensive system.
And if you think about it, every time we have trust, society benefits, and every time trust breaks, we pay a lot for it. And I’ll give you my favorite analogy for trust. And this analogy is something called “The Public Goods Game“.
The Public Goods Game: it’s not really a game, it’s an experiment that economists play. Here is how it works:
Imagine that we play the game in Porto, and we pick 10 random people. We wake them up in the morning, and we say: “You are one of the players, you are one of the 10 players of this game, and every morning, we are going to wake you up and give you 10 euros. You can do one of two things with those 10 euros: you can keep the money to yourself, or you can put it in a public pot, in a central pot. All the money in the central pot will grow throughout the day by five times. In the evening, it will be equally divided by everybody. The other players, you don’t know who they are, you’ll never find out who they are. And we’ll play this game day after day after day.”
So imagine we play this game. We start on day one, we wake up 10 people, and we tell them the rules of the game.
What happened? Usually, they all decide to put the money in the central pot. Ten people, each person gets 10 euros, multiply, it’s 100 euros. During the day, it grows five times.
In the evening we have 500 euros, equally divided by everybody, everybody gets 50 euros. Life is good! Right, you wake up with 10 euros, you go to sleep with 50. This continues and continues and continues until one day, one person decides to betray the public good. One person keeps the money to themselves.
What happened on that day? On that day nine people put 10 euros, 90 euros. Multiply five times, 450 euros. In the evening, it’s equally divided by everybody, including the bastard that didn’t put money in. Everybody gets 45 euros, right?